• The head of the CFTC, Rostin Behnam, recently spoke out against Binance and its leadership at a public-facing event held at Princeton University.
• Behnam accused Binance’s leadership of knowingly operating outside of U.S. laws governing the exchange of commodities and futures.
• Binance is facing legal action from the CFTC, IRS and federal prosecutors due to their alleged trading violations.
CFTC Chairman Accuses Binance Of Breaking Rules
The head of the Commodity Futures Trading Commission (CFTC), Rostin Behnam, recently spoke out against Binance and its leadership at a public-facing event held at Princeton University. During this event, Chairman Behnam accused Binance’s leadership of knowingly operating outside of U.S. laws governing the exchange of commodities and futures. As a result, Binance is now facing legal action from the CFTC, IRS and federal prosecutors due to their alleged trading violations.
Allegations Against Binance
Specifically, it is alleged that Binance had allowed U.S citizens to participate on the exchange through the use of virtual private networks (VPNs) and other obfuscation tools without registering with the CFTC or complying with applicable laws in order to do so. At Princeton University’s DeCenter Spring Conference on April 14th, Chairman Behnam stated: “These are not unsophisticated individuals…they are starting large companies and offering futures contracts and derivatives to U.S customers…If you are going to offer futures contracts in the U.S., there is a clear understanding that you are registered with the CFTC and comply by the law.”
CFTC’s Legal Action Against Biance
The CFTC has pressed seven counts against for executing unregistered futures transactions, providing illegal commodities options, failure to register as a Futures Commission Merchant or Designated Contract Market or Swap Execution Facility (SECF), failure to supervise diligently or implement AML/KYC measures as well as law evasion according to Cointelegraph’s report on April 13th 20203 .
Binance CEO Responds To Allegations
In response to these allegations levied against him as well as his company, Changpeng “CZ” Zhao – CEO ogf Binacne – has insisted that regulators need deep understanding of crypto for proper rules during an interview in March 2021 claiming: “I think it’s very important for us all regulators who have an interest in digital assets have some level of depth when it comes down into understanding digital assets”.
Overall while these allegations may be detrimental for some investors hoping for quick returns from trading furtures & commodites on unregulated platforms such as binance; It appears that chairman behman’s intentions were not only for protecting US consumers but also imporving industry standards by encouraging more regulatory oversight within this rapidly evolving sector