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SEC investigates Binance’s BNB ICO in 2017

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The US Securities and Exchange Commission (SEC) is now scrutinising Binance’s BNB coin, after XRP. Reportedly, the SEC is investigating BNB’s 2017 initial coin offering (ICO), alleging that Binance sold unregistered securities in violation of the federal securities law.

Bloomberg reports that both Binance and the SEC refused to comment on the incident. It would not be acceptable for us to comment on our continuing discussions with regulators, which involve education, assistance, and voluntary responses to information demands, Binance stated, adding that the business will continue to “meet all regulatory standards.” In the United States, Binance is subject to stringent regulatory regulation.

Report shows Laundering of $2.35 Billion in Illicit Funds

Following the release of an investigative report on the cryptocurrency exchange’s suspected role in long-running illegal activities, Binance is once again in hot water. According to the Reuters research, Binance facilitated nearly $2.35 billion in cyberattacks, investment frauds, and illegal drug transactions over a period of five years.

The study related to the period between 2017 and 2021 when Binance was accused of supporting a flood of illicit funds. The paper detailed how the US government sought assistance from the crypto researcher Chainalysis to track unlawful movements, which “concluded in a 2020 report that Binance received $770 million in criminal assets in 2019 alone, the most of any crypto exchange.” However, Binance CEO Changpeng Zhao responded by accusing Chainalysis of “poor business manners.”

The top cryptocurrency exchange has also been implicated in multiple other instances of money laundering. Reuters asserted that it examined the data given by Crystal Blockchain regarding Binance client transactions on “darknet” websites. As a result of the data finding, Reuters reported that “between 2017 to 2022, buyers and sellers on the world’s largest darknet drug market, a Russian-language website called Hydra, used Binance to make and receive $780 million in crypto payments.”

In addition, the investigation revealed that in 2020, fraudsters in Europe utilised Binance to “launder some of the proceeds from investment fraud schemes,” causing victims to lose a total of 750 million euros ($800 million).

Disclaimer: The opinions expressed in the Blog are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product. It is only intended to provide education about the financial industry. Please do your own research.