In a blog post on Binance’s official site made last July 7, CEO Changpeng Zhao reiterated his 2020 year-end statement that compliance is a journey, especially in new sectors like crypto, in relation to the regulatory crackdowns on cryptocurrency exchanges in the United Kingdom.
Moreover, he emphasized that the users’ protection and interest are held at a high priority following these accusations against the platform.
The UK’s Financial Conduct Authority (FCA) banned Binance from conducting any crypto trading activities in the country. According to the notice dated June 25, the cryptocurrency exchange cannot, without the prior written consent of the FCA, carry out any regulated activities effective immediately.
Moreover, FCA issued a warning to UK crypto traders about Binance Markets Limited, saying that they should be wary of unauthorised exchanges that advertise and promise high returns.
‘Before there were clear guidelines for the industry, we have always held Binance to the highest standard to prioritize our users’ best interests. Therefore, we have added requirements for using our platform and set industry standards,’ Zhao said.
Aside from the UK, regulators from Canada, Japan and Thailand issued their warnings about Binance. The Ontario Securities Commission accused the exchange platform of failing to comply with their local regulations while Japan’s Financial Services Agency claims that it was operating in the country without regulatory permission.
Additionally, the Securities and Exchange Commission of Thailand filed a criminal complaint against Binance saying that the platform is operating within the country without the state’s permission.
Binance as a positive contributor to the crypto industry
Binance shared three tangible steps to clarify and reiterate its commitment to financial and securities regulators amidst the accusations against the company namely:
- Appointing former Financial Action Task Force (FATF) Executive Secretary Rick McDonell and former Head of the Canadian delegation to the FATF Josée Nadeau as compliance and regulatory advisors as well as former US Montana Senator Max Baucus as an experienced advisor to the company;
- Partnering with CipherTrace and other anti-crime and money laundering organisations like United Nations Office on Drugs and Crime (UNODC) and Interpol to crack down on criminal activities that may take place on the platform; and
- Localising Binance operations and businesses to comply with regulatory requirements by specific countries or regions.
‘We hope to clarify and reiterate our commitment to partner with regulators, and that we are proactively hiring more talent, putting in place more systems and processes to protect our users,’ he said.
Despite this statement, Binance is still not allowed to offer crypto trading services in the UK as of press time. The FCA has also instructed the crypto exchange to display a notice on its website and social media accounts, saying, ‘Binance Markets Limited is not permitted to undertake any regulated activity in the UK.’
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