Zhao Changpeng Responds to CFTC Allegations Full Text

Source: Binance

Compiled by: Moni, Odaily Planet Daily

On the evening of March 27, Bloomberg reported that the Commodity Futures Trading Commission (CFTC) had filed a lawsuit against the cryptocurrency exchange Binance and its CEO CZ, as well as its first COO Samuel Lim, in the federal court in Chicago. On March 28, CZ released a response on Binance's official website, which is as follows:

Today, despite Binance's cooperation with the CFTC for over two years, the CFTC has brought an unexpected and disappointing civil lawsuit. After a preliminary review, the complaint appears to contain incomplete factual statements, and Binance disagrees with the characterization of many of the allegations in the lawsuit. While Binance can only provide a complete response at the appropriate time, this article will address several key points.

Compliance and U.S. Blocking Technology

Binance.com has developed top-notch technology to ensure compliance and was the first global (non-U.S.) exchange to implement a mandatory KYC program, and it remains one of the exchanges with the highest KYC and AML standards today. Binance prevents U.S. users through nationality (KYC), IP (including commonly used VPN endpoints outside the U.S.), mobile carriers, device fingerprints, bank deposits and withdrawals, blockchain deposits and withdrawals, credit card numbers, etc.

To our knowledge, no other company uses a more comprehensive or effective system than Binance to fulfill compliance requirements.

Cooperation with Law Enforcement and Transparency

Binance is committed to maintaining transparency and cooperating with regulators and law enforcement agencies both in the U.S. and globally. The Binance compliance team currently has over 750 people, many of whom have backgrounds in law enforcement and regulatory agencies. To date, Binance has handled over 55,000 law enforcement requests, assisting U.S. law enforcement in freezing/seizing over $125 million in funds just in 2022, and has reached $160 million so far in 2023.

Binance will continue to respect and cooperate with regulators in the U.S. and around the world.

Registration and Licensing

Binance.com holds the most licenses/registrations globally, currently reaching 16, and this number continues to grow.

Trading

Binance.com does not trade for profit or "manipulate" the market under any circumstances. Binance's "trading" can occur in several situations: Binance's revenue comes from cryptocurrencies, Binance does need to convert cryptocurrencies from time to time to pay for fees in fiat or other cryptocurrencies, and Binance has affiliates that provide liquidity for less liquid cryptocurrency pairs, but these affiliates are under special monitoring and cannot make significant profits through these cryptocurrencies.

Personally, I have two accounts on Binance: one for the Binance card and one for my crypto assets. I use our own products and store my cryptocurrencies on Binance.com, and I also need to convert cryptocurrencies from time to time to pay for my personal expenses or card transactions.

For employees, Binance.com has a 90-day prohibition on day trading, meaning Binance employees cannot sell tokens within 90 days of their last purchase, and vice versa, to prevent any employee from actively trading. Binance also prohibits our employees from engaging in futures trading. Additionally, Binance has strict policies for anyone with access to private information, such as list details, Launchpad, etc., who are not allowed to buy or sell these tokens.

I personally adhere strictly to these policies, and I have never participated in Binance Launchpad, Earn, Margin, or Futures. I know that I need to spend my time building a reliable platform to serve Binance's users.

At Binance, we seek amicable solutions to all issues and cooperate with regulators and government agencies around the world. While Binance is not perfect, we uphold high standards, often exceeding the requirements of existing regulations. Most importantly, Binance believes that users should always do the right thing. On the journey to financial freedom, Binance does not expect everything to go smoothly, but it also does not shy away from challenges.