There seems to be no end of trouble for Binance Coin from a regulatory standpoint, with new allegations of money laundering initiated by the Reuters news agency.
Summary
No end of pitfalls for Binance Coin
Last January, in a lengthy report, Reuters had accused the Binance exchange of hiding that it had a fairly lax conduct from the standpoint of controls on the platform. This would lead to the possibility, according to Reuters, that money laundering or otherwise illegal transactions could be carried out through Binance.
A few days ago, the world’s most famous Anglo-Saxon news agency reiterated and developed this concept. Binance is accused of wanting to insulate itself from regulators, for example by backdating its documents, and by other similar ploys. Yet recently Binance seems to be moving toward a policy of bringing itself into compliance in all the countries in which it operates, as it has done recently in France and Italy and in other countries, such as recently in Cyprus.
#Binance receives 4th regulatory approval in Europe with Crypto Asset Service Provider registration in Cyprus 🇨🇾
This registration allows us to offer spot, custodian, staking and card services in the country.
Read more ⤵️https://t.co/ws98asmIAF
— Binance (@binance) October 20, 2022
Reuters recalls in its article that in September 2021 Binance had been charged by the US Department of Justice specifically for money laundering. In fact, according to what the news agency reports, the exchange would use its own subsidiaries to evade scrutiny and thus its behavior would always be very much in the balance between legality and illegality.
Problems in Britain
According to news reports, the biggest problems for the exchange would be with the FCA, the London Stock Exchange’s regulator, which two years ago had already banned the exchange from operating on British soil, precisely because of allegations of lack of transparency and lack of authorization. In the piece, Reuters talks about the exchange’s submission of false documents to the FCA to circumvent the regulator’s regulations.
According to authorities, Binance allegedly was involved in money laundering last year to the tune of more than $2 billion.
The growth of Binance Coin (BNB)
The exchange founded by Changpeng Zhao in these years of almost non-stop growth has allegedly overlooked regulatory issues, even taking advantage of the vacuum that exists on the industry from a regulatory perspective.
The company’s growth is clearly demonstrated by the exponential growth of its BNB coin, which despite the market crash, has still been able to defend itself and has been one of the best performing assets in the market for the past few months in the face of average cryptocurrency collapses of 60/70%, or even 90% over the past year. For example, Bitcoin is down 65% from its highs of a year ago, while Ethereum is down 63%.
Evidently, investors remain optimistic about the exchange’s ability to develop and become one of the benchmarks for the cryptocurrency market as well as the very exciting ones involving decentralized finance and NFTs.
Binance’s Custody service becomes more secure
But in order to obviate these accusations and to show a behavior that is more compliant with the rules of the financial markets and the protection of its users, there comes fresh news about the exchange’s cryptocurrency custody services. In recent days the company announced that its custodial service would integrate risk management tools from TRM Labs, the industry leader in blockchain analytics and intelligence technology.
The integration would enable Binance Custody to better ensure regulatory compliance and risk management program by clients, precisely through TRM’s platform.
Binance Custody was launched in December 2021, and it is one of the most security- and privacy-conscious services for users on the market. Since its inception, the company has taken great care in the details of security and compliance with the highest security standards, obtaining ISO 27001 and ISO 27701 certifications and SOC 2 Type 1 attestation, and is currently pursuing its SOC 2 Type 2 attestation.
Now with the integration of services from the TRM platform, it is precisely seeking to counter those phenomena related to financial crime, such as money laundering crimes, for which Binance is accountable in multiple venues.
Athena Yu, EVP of Binance Custody, said:
“As an institutional custodian, our utmost priority is to provide secure and compliant services that our clients can trust. Utilizing TRM’s compliance and risk management solutions strengthens our suite of secure custody solutions to help clients safely participate in this rapidly growing digital economy.”
