Today is the end of Changpeng Zhao’s era as CEO Binance He later resigned and admitted to violating US anti-money laundering regulations, even though Binance was never an official US exchange. Thus, the myth of the “infinite” cryptocurrency company is truly over.
This is certainly not the first time that US law enforcement agencies have issued an arrest warrant for unofficial cryptocurrency exchanges in the country. The same happened with… FTX But no company embodies the “infinite” myth more than Binance, which will pay a $4.3 billion fine to settle a US Department of Justice investigation.
Binance challenges the boundaries of traditional companies, serving traders everywhere. It eventually became the largest cryptocurrency exchange in the world. But it seems that no one has known the whereabouts of the real office for a long time. The idea of a headquarters goes against the entire identity of Binance.
In 2018, CZ was asked where he lived. “People still have a very clear idea of where your company is. And where are you?” he responded to People at the time. “A company is an idea. An organization is just an idea.” When people ask him which office number they should call, he says, “I don’t really have an answer for that. I wonder is this the world?”
Binance notes that it is not based in the United States, other than Binance.US, which is a much smaller US entity. When was the last time a Czechoslovakian appeared in public on American soil? But it appears that the company is not exempt from US law. The United States accused Binance of not having a proper anti-money laundering program, and of running a money transfer business without a license. CoinDesk reported that it violated sanctions laws.
Meanwhile, the Department of Justice has accused Binance of allowing terrorist groups ISIS, Al-Qaeda, and Hamas to transact freely on its platform, and the Czechoslovakian could face up to 18 months in prison in the United States.
It was recently reported that Czechoslovakia was released on a $175 million bond.
“Binance has become the largest cryptocurrency exchange in the world. Partly because of the crimes committed — they are now paying one of the largest corporate fines in US history,” said Attorney General Merrick Garland.
The US Securities and Exchange Commission and the Commodity Futures Trading Commission (CFTC) have also taken enforcement action against Binance. The gist of these allegations is that Binance had US clients, telling them how to circumvent US regulations. They are taking steps to hide their activities from US regulators, and some in the cryptocurrency community criticize unfair US laws. Binance itself has responded to the CFTC in filing a lawsuit with the US court, saying: “US domestic regulation but it does not control the world.” “
In 2022 Founder BitMEX He pleaded guilty to violating US anti-money laundering laws, even though BitMEX is based in the Seychelles and of course FTX Well, we are here at FTX located in Hong Kong. Sam Bankman-Fried then moved to the Bahamas. You desperately want to live in the United States. It pays huge sums of money for celebrity endorsements and naming rights to stadiums. At the same time, he tried to win over politicians in Washington. Ultimately FTX’s global operations never entered the United States, except for the smaller and less powerful FTX.US, but Bankman-Fried and were instead attacked by US prosecutors.
The United States remains attractive for cryptocurrency companies despite the appeal of dynamic regions such as Asia or the Middle East. But it’s hard to avoid the United States. Do foreign exchanges have US users? Is it misleading American investors? Or the CEO has a meeting in America?
“The site burden is not very high,” Samson Ensor, a former federal prosecutor in Manhattan, told the Wall Street Journal last year. “The government will argue that if one email is sent through New York that is enough.”
We may never see another company quite like Binance. Cryptocurrencies may be limitless. But cryptocurrency companies may find it more difficult to operate outside legal or geographical boundaries. In the early days of cryptocurrencies, it seemed possible to launch a large-scale exchange that transcended any jurisdiction.
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