• Binance is being investigated in the United States for possible insider trading

  • Officials in the United States are reportedly looking into cryptocurrency exchange Binance once more. They are looking into possible insider trading and market manipulation at Binance. This development could add fuel to the fire for the cryptocurrency exchange, which is already under regulatory scrutiny in a number of countries.

    Insider Trading Investigations by the CFTC

    US authorities are investigating whether Binance or its employees profited from exploiting its customers. The article cited sources with knowledge of the situation who did not want their identities revealed because the investigation is private. According to one of these sources, the Commodity Futures Trading Commission (CFTC) has been reaching out to potential witnesses in recent weeks.

    Binance operates a massive trading operation that allows the exchange to see millions of transactions. As a result, US authorities are investigating whether the firm took advantage of that access, including by trading on customer orders before executing them.

    “At Binance, we have a zero-tolerance policy for insider trading and a strict ethical code related to any type of behavior that could have a negative impact on our customers or industry,” said a spokesperson for the exchange in a statement.
    They also stated that Binance’s security team has long-standing procedures in place to investigate wrongdoing. Furthermore, they hold employees accountable, with termination being the most severe repercussion.

    A spokeswoman for the CFTC declined to comment.

    Some of the CFTC investigators worked on the regulator’s case against cryptocurrency exchange BitMEX.

    BitMEX agreed to pay a settlement of $100 million last month. The CFTC and the Financial Crimes Enforcement Network accused the exchange of allowing residents of the United States to trade derivatives. Furthermore, it lacked adequate anti-money-laundering controls.

    Regulatory Concerns Regarding Binance

    The world’s largest cryptocurrency exchange has been dealing with numerous compliance issues in a variety of countries.

    In March that the US Commodity Futures Trading Commission was looking into the exchange. The regulator wanted to know if US citizens bought and sold cryptocurrency derivatives on the Binance platform. In May, it was revealed that the US Justice Department and IRS were also looking into the Group for money laundering.

    Due to a lack of proper licenses, a growing number of countries have demanded that the exchange stop providing services. Thailand, the United Kingdom, Malaysia, Hong Kong, Italy, Singapore, and South Africa are just a few of the countries where Binance has run into regulatory problems.

    In a blog post in July, Binance CEO Changpeng Zhao stated that there has been a “hyper-focus on regulation when it comes to Binance.” He also emphasized Binance’s anti-insider trading policies. Binance’s global compliance team and advisory board have grown 500% since last year, with plans to double their size by the end of 2021, he said.

    Greg Monahan, a former IRS investigator, joined Binance as its global money laundering reporting officer in August.

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