Department of Justice (DOJ) and Internal Revenue Service (IRS) are allegedly investigating Binance for tax evasion and money laundering.
Bloomberg reports that the national investigation is confidential. That is because IRS and DOJ have obtained data from people who are well familiar with Binance’s activities. The statement accused the crypto exchange of prospering without administration oversight. Keep in mind that Binance has no corporate headquarters and works with the Cayman Islands, which has more humane business activities and charges no taxes.
Remember, the US has been investigating crypto exchanges since last month. They aim to track all crypto platforms operating illegally within the United States markets. However, Binance Spokesman responded to the probe. The official stated that the platform is serious in handling its legal obligations, engaging with law enforcement and regulators cooperatively. Moreover, he declared that the platform has a detailed regulatory program that includes money laundering policies and instruments that financial institutions use to spot and address any suspicious activity.
Regulatory Inspection Continues in the Crypto Market
As much as you may want to enjoy the luxury that the crypto market has, keep in mind that the business has its dangerous side. Although here for over a decade, most individuals remain skeptical about the crypto space due to criminal activities. In January, Janet Yellen expressed concerns over criminals using cryptocurrency for illegal financing and terrorist deals. The official pointed out renowned monetary figures such as Charlie Munger, utilizing the crypto market to benefit extortionists and kidnappers.
Chainalysis, a US-based blockchain data analytic company, reported that Binance had more criminal activities in 2019 than other crypto exchanges. That was according to the transactions that the company had analyzed.
Keep in mind that the Binance exchange has been facing regulatory concerns for some time now. For example, the platform faced European regulators such as Germany’s BaFin and FCA. That followed Binance venturing into tradeable stock assets. However, the crypto exchange hired Max Baucus, a US senator, to oversee its regulations.
It is with no doubt that you know cryptocurrency is a risky business with fraudsters in the industry. Be careful about the regulatory status of any exchange to avoid trouble in your crypto investments.