In recent news, the largest cryptocurrency exchange platform in the world, Binance, and its general director, Changpeng Zhao, have entered into an agreement with American authorities resulting in a large bill. This agreement is a result of an investigation into Binance by American authorities that began in 2018. Despite committing to no longer accept American customers in 2019, Binance was found to have retained some American customers. As part of their agreement, Binance has committed to using an external observer for compliance purposes for a period of three years.
Changpeng Zhao, also known as “CZ,” has agreed to plead guilty to violating US anti-money laundering laws while Binance will also plead guilty to violations of US law and pay two fines totaling several billion dollars to the US Treasury. The violations by Binance include a failure to implement anti-money laundering measures, allowing a wide range of criminal actors to conduct trades on the platform. These actions highlight the challenges posed by digital currencies, which are used by criminal organizations and offer certain anonymity and less robust money laundering safeguards than the traditional financial system.
Despite retaining some American customers despite committing not to take them anymore in 2019, this agreement is a significant step towards holding cryptocurrency exchanges accountable for their actions and ensuring compliance with regulations. The company has also been scrutinized for its role in allowing transactions carried out by groups such as the Islamic State group, Al-Qaeda and Hamas. As part of their agreement with regulators, Binance will be required to comply with existing regulations for a period of three years.
In conclusion, this agreement underscores the need for increased regulation and oversight in the cryptocurrency industry