Binance, the world’s largest cryptocurrency exchange, is under investigation by the IRS and the DoJ

• Binance is currently facing money laundering and tax evasion investigations by the US Department of Justice and the Internal Revenue Service.
• The cryptocurrency exchange was also reportedly investigated by the Commodity Futures Trading Commission in March.
• The company stated that the exchange is collaborating with law enforcement.

The world’s largest cryptocurrency exchange by trading volume, Binance is being investigated by the US Department of Justice (DoJ) and the Internal Revenue Service (IRS).

Binance CEO rejects claims

While the subject of the investigation has not been disclosed, officials who generally handle the money laundering and tax crimes are involved, according to Bloomberg sources.

The IRS is targeting Binance users as well as the exchange’s employees. At the moment, government agencies have not accused the exchange of any crime.

Cryptocurrency analytics firm Chainalysis found that in 2019 some $ 756 million out of a total of $ 2.8 billion in illegal transactions involving Bitcoin went through the major cryptocurrency exchange.

Binance spokeswoman Jessica Jung stated that the company takes its legal obligations “very seriously and will engage with regulators and law enforcement collaboratively. “The company’s CEO, Changpeng Zhao, also known as CZ, responded on Twitter, calling the news misleading. He said:

The headline of the “news” is bad. The article itself is not that bad, actually (but who reads it). It describes how Binance collaborated with law enforcement agencies to fight bad participants, but somehow made it look like a bad thing.

CZ dismissed the report as fear, uncertainty and doubt. However, the damage has been done when Binance Coin price plummeted by more than 12%, reaching a low of $ 552 in the last hours. Bitcoin and Ethereum have also been affected by the increased selling pressure.

Bloomberg reported that The Commodity Futures Trading Commission (CFTC) was also investigating Binance in March. According to the news, regulators were determining whether users of the Malta-based exchange’s US platform bought and sold cryptocurrency derivatives on its platform outside of the US.

The company claims that it prevents US residents from accessing investment products that would require registration with the government agency if it were listed in the United States. Binance further clarified that it follows all legal and regulatory requirements within the countries in which it operates.