That is why Binance may have deliberately broken the law
The allegations by the US authorities against the largest crypto exchange are increasing. Now the CFTC is even bringing charges in several cases and demanding long-term penalties. Statements by the company founder now suggest why Binance may have deliberately broken the law, despite publicly defending itself against the allegations.
Reading tip: CFTC files lawsuit against Binance
Crypto exchange breaking US laws?
After the SEC attacked Binance in February, the CFTC recently hit it. Both organizations accuse the crypto exchange of violating US laws.
The CFTC even alleges that Binance acted intentionally on several of the eight counts. Several quotes from high-ranking employees of the crypto exchange emerge as evidence from the indictment.
Samuel Lim, the former head of the compliance department at Binance, deliberately tolerated users who traded cryptocurrencies from illegal sources or for illegal purposes.
In addition, Binance is said to have repeatedly recommended US users to disguise their IP address in order to avoid restrictions. Now a Twitter user comments on the allegations. According to his own statements, he has legal background knowledge.
The user, dubbed Rocket , also believes that Binance intentionally broke laws. That would also have good reasons. He provides arguments for the deliberate violation of laws in the form of comments made by Binance founder Changpeng Zhao himself in 2019.
Binance has violated the regulations and is facing civil penalties for doing so. They recognized the problem and made the business decision to ignore the regulations and pay fines instead.
Write Rocket. The CFTC is demanding fines, among other things, for the alleged violations.
That is why Binance may have deliberately disregarded laws
According to Rocket, it is financially beneficial for a company like crypto exchange to deliberately disobey the law and thus accept a fine. The same example can be observed in the banking industry. Big banks like JP Morgan or Goldman Sachs have already had to pay fines for market manipulation, which only account for a fraction of the illegally generated profits.
CZ already commented on this special feature at a board meeting in 2019. At that time, the managing director of crypto exchange explained that the implementation of all US sanctions would be too complex. In addition, his company already violates too many US laws to have to pay attention to compliance with every regulation.
Simply put: «The juice is not worth squeezing. After acknowledging the violations and knowing it would have to pay fines, Binance did everything in its power to stop US customers from using the platform.
Rocket believes Binance will get away with a fine of less than $100 million. However, not all of the CFTC’s allegations are realistic. He thinks it’s ironic that the CFTC is making allegations that can only apply to registered financial assets.
However, since Binance did not register the investments in question, the CFTC also criticized the lack of registration. According to the CFTC, Binance futures are said to have been illegally distributed by the crypto exchange.
