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CTFC investigates Binance trading activity

United States Commodity Trading Futures Commission (CTFC) probes Binance Holdings Ltd regarding possible derivatives trades made by US-based customers. The world’s largest cryptocurrency exchange is under investigation after an anonymous source tipped off the possible trades.

For the past few weeks, CTFC regulators are reportedly determining whether illegal cryptocurrency assets were bought and sold by U.S citizens on the Binance platform.

Presumably, Binance does not allow users with American IP addresses to enter the site to reduce illegal transactions on the platform. However, founder and CEO Changpeng ‘CZ’ Zhao habitually pushes traders to use VPN.

‘We have always blocked US access, but users do find intelligent ways to get around our block sometimes and we just have to be smarter about the way we block,’ company co-founder Changpeng Zhao reported to Bloomberg last November of 2020.

An unnamed Binance spokesperson stated on Cointelegraph though that they cannot comment yet on the investigation but they are in full compliance to regulations. ‘We do not comment, as a matter of policy, on Communications with any regulators. What we can say is that we take a collaborative approach in working with regulators around the world and we take our compliance obligations very seriously.’

According to CTFC, cryptocurrencies are considered to be dangerous commodities. For this reason, they firmly believe that they should have administrative power over these assets. This means stricter customer protection for crypto exchange platforms.

Soon after news of the investigation surfaced, CZ maintained that the crypto exchange complies with US laws. Moreover, he mentioned that the report has no evidence of the accusation.

‘This is a topic that just came up, literally like a few minutes ago or an hour ago. So number one, the news article said there was no, I don’t have it in front of me, there was no “misconduct,” I have to dig it up. So number one there was no report of misconduct from Binance, so the report kind of defeated itself.’ he added.

He also stated that the other competitors might have bribed or pressured journalists to publish stories heavy on allegations against them.

On the contrary, CZ explained that he understands the safety protocol and noted that the quality of their security also needs to ‘improve.’ He also noted that, as a business, Binance preserves its ‘no comment’ policy.

‘Right now there’s kind of a gap between the industry players and the regulators. I want to see, hopefully, both sides extend their hand and bridge that gap,’ stated CZ.

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