Binance joins global sanctions organization amid heightened compliance scrutiny
Binance, the world's largest crypto exchange by trading volume, is making a new public effort to show it's taking compliance in the crypto market seriously.
On Friday, the company announced it will join the Association of Certified Sanctions Specialists (ACSS) to enhance the expertise of its international compliance team.
“By working closely with the ACSS, we will take our sanctions compliance standards to a level that is recognized by a reputable industry association and provide upskilling opportunities for our compliance team,” Binance's Global Head of Sanctions, Chagri Poyraz, said in the release.
"At the end of the day, we want to continue setting the industry standard for security and compliance alongside other industry players," Poyraz added.
This news comes after a report from Reuters last month which cited sources saying, "at least half a dozen U.S. prosecutors" believe an investigation into the exchange has surfaced evidence justifying criminal charges. Reuters also reported some officials have discussed possible plea deals with Binance attorneys.
Binance denied the report on Twitter, saying: "Reuters has it wrong again" in response to its December report.
In August of 2021, Binance made the decision to no longer allow customers to open accounts using only an email address. However, the company made headlines earlier in the year when it was able to recover stolen funds from North Korean hackers in April.
In December, Binance released a "proof of reserves" report that caused controversy within the cryptocurrency community for only disclosing information about the company's bitcoin assets. This led to the accounting firm Mazars, the company responsible for the report, suspending all work with cryptocurrency firms, including Binance.
Binance.US, a separate legal entity from Binance which has a licensing agreement and is majority owned by Zhao, has also faced scrutiny for potentially violating sanctions.
In December, Binance.US was selected by the bankruptcy estate of crypto lender Voyager Digital to purchase Voyager’s customer assets and associated debt for $1.02 billion. This deal came after the original “white knight” buyer, FTX, collapsed into its own bankruptcy.
Since then Voyager has faced objections from both the SEC and the Texas State Securities Board, with the federal agency requesting additional disclosure on Binance.US’s ability to "consummate a transaction of this magnitude."
In the TSSB’s complaint, Joseph Rotunda, the state agency’s director of enforcement, shared that the state was also probing Binance, given its relationship to Binance.US. Specifically, the official highlighted the U.S.-based crypto exchange's Terms of Use, which Voyager customers will need to accept in the event the purchase is completed.
According to the Terms of Use, Binance.US appoints "market makers, including Related Parties and market makers that are incorporated or otherwise operating outside of the United States." While the "Related Parties" are not identified, Rotunda addressed the possibility that by moving to Binance.US, Voyager customers assumed the risks of the larger exchange.
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