CZ fights back at US agency’s accusations

Image credit: Timmy Loen

The US Commodity Futures Trading Commission (CFTC) has filed a civil complaint alleging that Binance CEO Changpeng Zhao violated a number of its regulations.

The complaint also charges Samuel Lim, the crypto firm’s former chief compliance officer, as well as three entities that together operate Binance‘s platform.

According to the agency, Binance had instructed employees and customers to skirt compliance measures to “maximize corporate profits.” It further alleged that the crypto exchange did not have identity-verifying measures in place, a requirement for futures commission merchants such as itself.

The CFTC also said Zhao is liable for Binance’s violations, given his control over the company. Lim, who served as the firm’s CCO from 2018 to 2022, is charged with abetting these violations

With the complaint, the CFTC called for civil monetary penalties and permanent trading and registration bans for Binance, among other measures.

“I have been clear that the CFTC will continue to use all of its authority to find and stop misconduct in the volatile and risky digital asset market,” said CFTC chair Rostin Behnam, adding that Binance knew it was violating guidelines “for years.”

See also: Binance’s dominance grows in FTX’s absence

In response to the “unexpected and disappointing” development, Zhao said the agency had an “incomplete recitation of facts” and addressed a few of the CFTC’s main complaints.

Through a blog post on Binance’s website, the CEO pointed out that the firm has “one of the highest standards” in KYC implementation.

He added that the company has over 750 people on compliance duties and that it intends to continue working with regulators across the globe.

“Binance.com holds the highest number of licenses/registrations globally, 16 and counting, and is well regarded by our user community,” Zhao said.

The company said it will offer a complete response to the CFTC’s complaint “in due time.”