Opinion: Binance Pressure Is A Step Towards Cryptocurrency Legitimation

Get real time updates directly on you device, subscribe now.

The Binance cryptocurrency exchange has found itself at the center of several regulatory scandals at once. Recently it became known that the Polish financial regulator issued a warning about the risks associated with Binance. Similar measures have already been taken in the UK, Japan, Thailand, Canada. In the Cayman Islands, a case was brought against the exchange in general.

According to Chen Limin, chief financial officer and head of the ICB Fund’s trading department, the current claims against Binance, as well as rumors that the American Futures Trading Commission (CFTC) is already interested in the company, should be taken as a step towards legitimizing the digital asset industry. …

 

“Binance could have chosen as a benchmark against which the new rules of the game will be worked out. Previously, BitMEX acted in this capacity – the criminal prosecution of the founders of which became a signal of the need to implement and adhere to the highest AML / CFT standards, ”the expert said.

 

The downside of success

Binance is the largest trading platform in terms of trading volume. The company has relied on high-quality service, a wide product line and protection of user funds, including through the so-called SAFU-fund. Rapid expansion amplified the effect. According to Limin, the exchange’s success is largely due to the global reach of the crypto community.

However, this advantage greatly annoys regulators, who do not have direct leverage over the exchange. According to the latest FATF report, only 58 out of 128 jurisdictions have implemented crypto industry regulation standards. In many countries, the authorities have not yet finally formulated their position and have not figured out what leverage to use for cryptocurrency companies. Therefore, they are forced to put pressure on them indirectly, through intermediaries.

 

“For example, trading in crypto derivatives is prohibited in the UK, but its residents (and there are 2.2 million of them) can freely open an account on this platform and bypass these restrictions. As a result, the authorities may have secretly been forced to give orders to local banks not to make payments related to the cryptocurrency exchange, ”explains the CFO of ICB Fund.

 

Binance Can’t Be Frightened

News of regulatory harassment and even that banks, including Barclays, are blocking payments to Binance accounts did not affect the value of the cryptocurrency exchange’s native token in any way.

Most likely, the market does not doubt Binance’s ability to settle the claims of the authorities and find a way out of this situation, the expert said.

 

“Perhaps the situation will change if Binance faces claims from the US authorities. But they have not been announced and the cryptocurrency exchange has time for PR and GR specialists to be able to maintain its reputation. ”

 

Binance recently implemented the CipherTrace Traveler solution to enforce the FATF Travel Rule. The company has been staffed with highly trained compliance professionals, including a former US Senator and a former executive secretary of the FATF itself.

Get real time updates directly on you device, subscribe now.

Leave A Reply

Your email address will not be published.