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Texts and Documents Reveal Binance’s Attempt to Evade US Regulators – WSJ

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March 7, 2023

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March 5 (Reuters) – A Wall Street Journal report on Sunday revealed that Binance, one of the most prominent cryptocurrency exchanges, had devised a plan to dodge potential legal action from U.S. authorities.

An executive at the firm warned colleagues of a potential “nuclear fall out” should the government institute a lawsuit against the unregulated crypto players, according to the WSJ, which cited a Binance text from 2019.

The report was based on messages and documents from 2018 to 2020 that were reviewed by the Wall Street Journal along with interviews with former Binance employees.

Binance, which was established in 2017, has been thriving ever since. The report uncovered that Binance.US and Binance.UK have a much closer relationship than the companies have made public. They interweave personnel and finances as well as an affiliated entity that has purchased and sold virtual currency.

It is worth noting that the majority of Binance.com staff worked in Japan and China, with only a fifth based in the U.S. Binance.US has its headquarters in San Francisco.

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Programmers of Binance in China devised code that empowered BinanceUsers in the United States to hold digital purses that could offer access to Binance According to the Wall Street Journal, access to U.S. consumer data was possible.

Since the start of 2020, the Justice Department and the Securities and Exchange Commission have been carrying out an inquiry into the connections to BinanceThe story mentioned that.US received subpoenas, as well as those with knowledge of the matter. If American regulators determine that Binance They may also assert authority to regulate if they control the U.S. entity. Binance’s business as a whole.

In an emailed statement to Reuters, a Binance representative said “We have already recognized that we did not have sufficient compliance and controls in place during those early years…we are an entirely different enterprise now when it comes to compliance.”

Binance.US, the SEC, and the DOJ did not answer requests to comment. Reuters welcomes comments.

Binance The exchange is now facing increased oversight after three U.S. senators asked for information about its adherence to regulations, and financial records, from BinanceFor more info visit.US

Reuters states that BinanceIn 2019,.US was set up as a de facto subsidiary to dodge the examination of U.S. regulators. Binance.com.

Reporting by Akriti Sharma from Bengaluru; Editing by Richard Chang and Diane Craft

Our Standards: The Thomson Reuters Trust Principles.