We Began with Binance: CFTC Warns All Cryptocurrency Exchanges
The decision of Changpeng Zhao, the chief executive officer of Binance Exchange, to step down from his position to settle his issues with the US Department of Justice remains the latest epic movement that shook the whole crypto community down to its marrow. The legal lawsuit, which was jointly filed by the DoJ and the Commodity Futures Trading Commission (CFTC), charged CZ with breaching anti-money laundering rules, to which the accused pleaded guilty.
However, the latest update on the case highlighted that the commissioner of CFTC, Caroline Pham, announced that the commission has only started its scrutiny exercise with the Binance case, issuing warnings to all crypto platforms in the country that it is coming for them. Pham added that it would not stop its scrutiny on offshore financial entities that have branches in the region. Chipping in his comment, Christian Romero, another commissioner at CFTC, added that the US authority does not and would not condone any pirate ships, as they consider access to their citizens a rare privilege for foreign businesses.
CFTC To Scrutinize Offshore Exchanges In US
According to the report, the CFTC stated that the recent legal brawl between the US financial regulators and the Binance exchange demarcates the starting point of a fierce scrutiny of crypto firms. In addition, the commission said that its scrutiny would be fair and unbiased as it plans to target foreign financial entities dealing in financial assets such as cryptocurrency.
A CFTC commissioner, Caroline Pham, stated in a recent speech that the agenda of the commission is borderless and would give no favoritism, as evident in its pursuit against crypto legend, Changpeng Zhao. Meanwhile, the report revealed that the crypto industry as a whole had been having bumpy rides since the collapse of FTX exchange last year, as many big guns in the industry had been under regulatory scrutiny.
Meanwhile, the court case against Binance revealed that CZ pleaded guilty to breaching anti-money laundering laws of the US Congress, as well as executing sales of unregistered bonds worth $170 million to US investors.
US Continues To Clampdown On Crypto Entities
Consequently, CZ relinquished his power as the CEO of Binance and is due to pay a fine of $50 million. Also, Binance has been obligated to pay a whopping $4.3 billion as a settlement fee to the US authorities, to which a portion would go to the CFTC.
Meanwhile, the United States CFTC had been trying to nail Binance on different allegations in the past, which the giant firm had been dismissing. However, in the light of the new development, CFTC might have gained considerable evidence and reasons to aggressively pursue the exchange platform again. Nonetheless, reports showed that CFTC is now focused on scrutinizing other crypto firms in the US. Also, in recent times, the US government has tightened its regulations on crypto while claiming its aim is to protect the trading portfolios and funds of crypto investors in the country from the risks plaguing the industry.
CFTC Official Comments On The Case
As the new development continues to make waves, many crypto enthusiasts expressed their views on the issue. Christian Goldsmith Romero, a commissioner at CFTC, commented that the US markets give no room to private ships, as they consider foreign entities to be lucky to have interaction with the US citizens as it’s not their right. He revealed that the commission plans to fairly and legally track down financial firms performing illegal activities in the region.
In addition, Goldsmith pointed out that the use of VPNs is hitherto prohibited, and no action that bypasses mandated KYC protocol would be tolerated, including the pop-up questions meant to confirm users’ location. At the moment, Richard Hag is the new chief executive officer of the giant crypto exchange, Binance. In addition, the ex-CEO of Binance, Changpeng Zhao, awaits the final hearing of his case, which is slated for February 2024.
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