The platform, which has 90 million users, faces two investigations: one from the American stock market policeman, the other from the Reuters news agency.
Bad times for the Binance cryptocurrency exchange platform, which is the subject of a particularly negative investigation by Reuters, but also due process by the police of the American Stock Exchange, the Securities and Exchange Commission (SEC).
After the crypto-crash, we feel that the regulatory vice is tightening around the major trading platforms, for lack of initiative at the legislative or strict regulatory level, this requires case law.
Thus, on the one hand Binance is indeed the subject of an investigation by the SEC on binancecoin (BNB), a cryptocurrency created by the platform, launched via an Initial Coin Offering (ICO, which is a form of introduction exchange in the cryptocurrency sector, in the form of a token sale) five years ago. To date, binancecoin is the third largest cryptocurrency in terms of capitalization according to Coinmarketcap, with $46 billion in capitalization.
The SEC wants to establish whether this token was completely legal at the time, and whether it had all the investment qualities and transparency required for the investor. A real reverse investigation that could hurt Binance, which is also implicated by a Reuters investigation.
$2.3 billion in fraudulent amounts
This investigation speaks of a massive fraud on Binance with $2.35 billion in fraudulent amounts allegedly laundered there via cryptocurrency transactions, mostly from large-scale hacks, investment fraud and illegal drug sales, according to Reuters.
Separately, specialist firm Chainalysis, contracted by US government agencies to track illegal flows, concluded in a 2020 report that Binance received criminal funds totaling $770 million in 2019 alone, more than any other cryptocurrency exchange platform,” Reuters added.
The facts would have taken place before 2021 and the strengthening of transparency rules at Binance. But the investigation reveals that before this date, Binance had absolutely no precise idea of who was investing and when on its platform.
For the moment, no legal action is envisaged on these transactions suspected of being fraudulent. But as we can see, the vice is tightening on the crypto sector at the level of market authorities and specifically through actions on the transmission nodes between the world of cryptocurrency and the traditional financial sphere.