"Zhao and Binance secretly controlled the Binance.US platform's operations behind the scenes," the agency said, in a statement.
operations independently, but according to the S.E.C., that firewall has been more permeable than the company has let on publicly. Two subsidiaries, BAM Trading and BAM Management, supposedly controlled the U.S. customers" to trade on its international exchange. says the company and its chief executive "subverted their own controls to secretly allow high-value U.S. As such, U.S.-based investors aren't supposed to use Binance's global platform, known as .īut in today's filing, the S.E.C. Since 2019, Binance has run a separate exchange for customers in the United States, known as Binance.US, to comply with U.S. Like other large crypto companies, Binance operates products tailored to different countries and regulatory regimes. Most recently, in March, the Commodity Futures Trading Commission, accused the company of violating the Commodity Exchange Act and several CFTC regulations.īinance accused of not properly registering U.S. Gensler himself has often compared the crypto world to "the Wild West."īinance's market share has grown dramatically since FTX went out of business, and in recent months, it has been the focus of regulators and law enforcement agencies in the U.S. So far, the biggest target has been FTX, a company that collapsed in spectacular fashion and faces a slew of criminal charges that threaten to send its founder and former CEO, Sam Bankman-Fried, to prison for over 100 years. SEC's actions are the latest in a barrage of actions being taken by regulators against crypto companies. Regulators are going after crypto companies securities laws by announcing sham controls that they disregarded behind the scenes so they could keep high-value U.S. "Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law," said SEC Chair Gary Gensler, in a statement. customers to trade crypto on an exchange that is supposed to be off-limits to U.S. also accused Binance of running an unregistered trading platform in the U.S. accused Zhao and his company of misleading investors about Binance's ability to detect market manipulation as well as of misusing customer funds and sending some of that money to a company controlled by CZ, among other charges. It's the latest in a string of actions being taken against crypto companies.Īnd on Tuesday, the Securities and Exchange Commission sued Coinbase, which runs the largest cryptocurrency exchange in the U.S.īoth companies are accused of failing to register with the S.E.C., which claims to have regulatory oversight of most cryptocurrencies. On Monday, it filed 13 charges against Binance, which operates the world's top crypto exchange, as well as its billionaire co-founder and CEO, Changpeng Zhao, who is widely know as CZ. regulators are targeting more giants in the world of crypto.
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