Oops, it appears like the cryptocurrency trading site Binance is under attack. An investigation has been initiated into the actions of employees who have caused harm to customers.
The rumours have been around for a while, but they are growing increasingly persistent. The site is currently under greater regulatory scrutiny as a result of alleged abuses at its cryptocurrency exchange, which has resulted in increased regulatory pressure. According to Bloomberg, US investigators have broadened their probe into cryptocurrency exchange Binance. This is in addition to the possibility of insider trading and market manipulation. Those are some serious allegations!
Binance has been the subject of extensive research.
The corporation has not been charged with any wrongdoing (as of yet). However, according to reports, inspectors from the Commodity Futures Trading Commission have spoken with possible witnesses regarding matters such as the location of Binance servers (and thus whether the US can prosecute any cases). This committee had already initiated an investigation into the sale of derivatives that were linked to cryptocurrency at the time of publication. It is apparently looking for internal Binancedata that could reveal the sale of those derivatives to customers in the United States, which would be in violation of legislation forbidding such transactions without registration. In addition, the tax authorities and the Department of Justice in the United States are looking into alleged money laundering tactics on the stock exchange there. If it can be done there, it will very certainly be done elsewhere (maybe in the Netherlands?) and this could have major ramifications for the cryptocurrency exchange Binance.
Binance steps in to help.
The charges have elicited a robust response from the firm. That is entirely understandable given the potential consequences of a guilty verdict on their professional image. Bloomberg reported that an insider trading “zero-tolerance” policy is taken by the exchange, which also has codes of conduct and security procedures in place to prevent such actions. The firm went on to say that violators will be fired. It is not apparent whether or not this has occurred as well.
America is becoming more involved and aggressive in its efforts to combat cryptocurrency. Officials are concerned that a lack of consumer protections (including regulations) could hurt customers who sign up for services and anticipate the same precautions that they would receive if they were using traditional money instead of cryptocurrency. It is the liability that is the focus in this case, as insider trading has the potential to ruin valuable investments and erode trust in Binance and other cryptocurrency exchanges. People would be kept occupied for a long time to come as a result of the investigation into Binance and its outcome.