Hot Development: New Investigation into Binance Exchange!


According to a report by the Wall Street Journal on Tuesday, Binance has faced a new investigation. While the US is still working on comprehensive cryptocurrency regulation, the SEC continues to scrutinize exchanges and crypto companies under current laws.

Binance US Investigation

The US Securities and Exchange Commission has launched an investigation into the cryptocurrency giant’s US-based arm, Binance.US, according to a report by the Wall Street Journal on Tuesday. Merit Peak Ltd and Sigma Chain AG, two trading firms affiliated with Binance CEO Changpeng Zhao, are at the center of the investigation as the securities watchdog tries to determine exactly how they relate to the subsidiary. In late 2021, Zhao was the head of both companies.

Trading platforms are required by law to disclose the names of linked market makers where they can trade more efficiently to gain an unfair advantage over other traders.

Details of the Investigation

Launched in September 2019, Binance.US was also subpoenaed by the SEC in 2020. The regulator wants to know if the subsidiary really operates independently of the main exchange. Rival Coinbase, which went public last April, told the Wall Street Journal that it does not work with any (company) affiliated market makers.

Until recently, Binance did not engage very closely with regulators to increase its share of the global market. As a result, it has faced frequent investigations. The SEC, on the other hand, wants all cryptocurrency exchanges to reorganize their operations in line with current laws.

Binance CEO CZ even came up with the idea of ​​transferring his current role to a different name in the face of increasing pressure last year. By aggressively expanding its compliance department to meet local regulators’ demands, Binance wants to avoid potential investigations.

US citizens are prohibited from investing in cryptocurrencies on Binance global, and they can only open accounts on Binance US systems, the US arm of the popular exchange.