Binance, the world’s largest cryptocurrency exchange, is reportedly under investigation by the US Department of Justice (DOJ) for possible violations of sanctions against Russia. The probe is investigating whether Binance allowed Russians to evade restrictions imposed over Moscow’s invasion of Ukraine. The DOJ’s national security division is looking into whether the company or its officials have violated restrictions introduced in relation to Russia’s invasion of Ukraine as part of a confidential investigation. Five sources familiar with the matter revealed the inquiry, which is moving on a parallel track with an existing criminal division investigation. Binance is accused of flouting compliance with anti-money laundering requirements as well as supporting the trading of unregistered securities.
Binance has been in talks with the DOJ in an attempt to resolve complaints related to previous allegations that it was used to bypass sanctions against Iran before introducing stricter compliance controls. It has recently launched an initiative to completely overhaul its corporate governance structure, including bringing in a world-class bench of seasoned executives to fundamentally change how Binance operates globally. The company emphasized it complies fully with all US and international sanctions, pointing out that its Know-Your-Customer protocols rival any in the traditional banking system and every Binance user is required to pass these procedures, which include verifying the country of residence and checking personal identification.
The news comes after Russian crypto media reports in late April suggested that Binance quietly lifted some restrictions on Russian users. According to the information published by different news outlets, Russians could once again use their bank cards to make deposits, and the trading platform had canceled a limit on their balances introduced in compliance with EU sanctions. The US Justice Department had so far declined to comment on the latest incident.
Binance has already been in the focus of other US investigations. The US Internal Revenue Service is investigating its compliance with anti-money laundering requirements, and the Commodity Futures Trading Commission has filed a lawsuit against Binance and its founder for suspecting that Binance had illegally offered and sold securities. Meanwhile, the Securities and Exchange Commission has been examining if the platform supported the trading of unregistered securities.
Binance is a hot topic these days, and it is being investigated by various US departments and regulators. The investigation underscores the regulatory challenges facing the cryptocurrency industry and Binance’s struggle to reassure regulators around the world of its adherence to global laws and regulations.
The case is still developing, and the DOJ has yet to announce the results of its investigation. Therefore, it is difficult to determine what consequences the probe will have for Binance and the broader cryptocurrency industry. However, the investigation shows that cryptocurrency companies can expect additional scrutiny for their adherence to global laws and sanctions in the foreseeable future. Nevertheless, it remains to be seen how these regulatory actions will affect the growth of the cryptocurrency space.
In summary, Binance, the world’s largest cryptocurrency exchange, is being investigated by the US Department of Justice (DOJ) for suspected violations of sanctions against Russia. The investigation is probing whether Binance was used by Russians to evade restrictions imposed over Moscow’s invasion of Ukraine. The DOJ’s national security division is looking into whether the company or its officials have violated restrictions introduced in relation to Russia’s invasion of Ukraine as part of a confidential investigation. The report adds another layer of scrutiny to Binance’s already troubled history with US regulators as it has been accused of flouting compliance with anti-money laundering requirements and supporting the trading of unregistered securities.