Binance Slams back Senators’ Allegations with Open Letter

Binance Slams back Senators’ Allegations with Open Letter

Key Insights:

  • The CFTC earlier sued Binance on allegations of a commodities law violation
  • The crypto exchange was also accused of facilitating fraud by some U.S. senators
  • It responded to these senators' assertions with an open letter

Binance has, in true fighter fashion, responded to the letter from U.S. legislators that claimed they are a breeding ground for illicit financial ventures. The crypto exchange clapped back with an open letter, saying these accusations were founded on incorrect information. 

This recent occurrence takes us to another chapter in their saga.


Binance vs. U.S. Senators

On March 1, some U.S. senators, Elizabeth Warren, Chris Van Hollen, and Roger Marshall, sent a scathing letter to Binance US President and Binance CEO Changpeng Zhao. In it, they alleged that the crypto exchange and its American branch tried to dodge U.S. regulators and sanctions and aided payments worth over $10 billion to criminal characters. 

They further claimed that the company and its affiliated entities knowingly evaded regulators and concealed crucial financial information. 

Binance and its related entities have purposely evaded regulators, moved assets to criminals and sanctions evaders, and hidden basic financial information from its customers and the public."

Next, they questioned their integrity.

Your actions have called into question the legitimacy of your business and the safety of your customers' assets and raised concerns about the potential impact of these activities on the stability of the crypto market and the broader financial system." 

Binance then countered with a letter that contained comprehensive information on its compliance program, sanctions compliance, and collaborative effort with law enforcement. It also said that the senators based their allegations on articles that possessed wrong or incomplete information.

The company stressed its commitment to compliance.

"Binance has made meaningful efforts to invest in compliance, including by beginning to build its compliance program within a year of launch."

It further mentioned how it is the first significant exchange outside the U.S. to "require mandatory KYC procedures for all users" – a method for both new and old users to complete Intermediate Verification to access Binance's products.

It discussed how they take

Sanctions compliance seriously and has voluntarily put in place measures to avoid involvement in transactions that would be barred by the trade restrictions and sanctions laws of several countries and organizations."

Information was also about how it "proactively cooperates and partners with local law enforcement." It mentioned how they had previously assisted law enforcement in critical security-related issues in different countries and organized and participated in numerous workshops to train law enforcement agencies to combat cyber and financial crime globally.

Last but not least, it talked about providing a safe and transparent digital platform, stating that users could withdraw all their assets from the platform at any time. In addition,

Binance has shared its cold and hot wallet addresses."

It also mentioned how they are equipped with security measures, such as Margin Insurance Fund, to "protect users from losses when their cross margin equity is less than zero."

Binance vs. the Senators
Binance vs. the Senators

What's next for Binance? 

Binance still has a pending issue with the CFTC after being sued for alleged commodities law violations. They were accused of not registering with the proper market regulators before their trading services were used in the U.S. 

With the evidence that the CFTC has gathered against the crypto exchange, many crypto analysts fear that this could spell the end of it in the U.S. The overall effect this could have on the crypto world remains to be seen. However, this doesn't exactly look good on paper.

What.s next for Binance?
What.s next for Binance?

Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information but will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.

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