3 Burst results for "Binance Group 'S"
The Crypto Overnighter
"binance group s" Discussed on The Crypto Overnighter
"Of the Hinman documents is expected to intensify competition among major cryptocurrencies to become more decentralized and to resemble Ether more closely. Although I have to be honest, given the hype level around those documents and given just how hard the SEC fought to keep the Hinman documents under seal, I'm kind of let down. I just thought it would be bigger. Binance has been making some strategic moves in response to increasing regulatory scrutiny worldwide. One of those steps involves Binance UK's based subsidiary Binance Markets Limited or BML. BML has recently cancelled its registration with the Financial Conduct Authority. This decision was officially confirmed by the FCA on its website. The FCA said following the cancellation of BML's permissions, no entity within the Binance group is authorized or registered to conduct any regulated business in the UK. This decision was the result of a cancellation request submitted by Binance, which the FCA completed on May 30, 2023. Binance clarified that this deregistration does not affect Binance's operations. This is because BML had never conducted any regulated business in the UK. Binance Group acquired BML in 2020 with the intention of launching a regulated business in the UK, but this plan did not materialize. Despite this, Binance continues to hold five regulated entities in Europe, including France, Spain, Poland, Italy, and Sweden. A Binance official said on Twitter that as the Markets and Crypto Assets Regulation is set to come into focus in 2024 -2025, Binance is focusing on getting ready. Binance has already faced regulatory issues in the UK before. In 2021, the FCA ordered Binance to cease all regulated activities in the country. This recent deregistration comes after Binance's Chief Strategy Officer, Patrick Hillman, expressed the company's commitment to becoming regulated in the UK, despite facing regulatory challenges in the US. Binance is currently dealing with two civil lawsuits from US regulators, both the SEC and the CFTC. Before I went on my break, we talked about how, in addition to its challenges in the UK and the US, Binance also recently announced its exit from the Netherlands after failing to acquire regulatory approval.
The Breakdown
Binance Accused of Co-Mingling Customer Funds With Company Revenue
"Hello friends. Well, this morning as I was prepping the show, news broke from Reuters. Walter Bloomberg on Twitter said, the world's largest cryptocurrency exchange Binance co -mingled customer funds with company revenue in 2020 and 2021. In breach of U .S. financial rules that require customer money to be keep separate, three sources familiar with the matter told Reuters. So let's go through this, let's try to get a sense of how serious this is, let's see if there is another Sam -type situation on our hands. First, let's talk the accusation. Well, it's pretty much right there in the headline, Binance co -mingling customer funds with company revenue in 2020 and 2021, the sourcing, three sources familiar with the matter and Reuters, but let's try to get a few more details. From the Reuters piece, quote, one of the sources, a person with direct knowledge of Binance Group's finances, said the sums ran into billions of dollars and co -mingling happened almost daily in accounts the exchange held at U .S. lender Silvergate Bank. Reuters couldn't independently verify the figures or the frequency, but the news agency reviewed a bank record showing that on February 10th, 2021, Binance mixed $20 million from a corporate account with $15 million from an account that received customer money. Reuters found no evidence that Binance client monies were lost or taken. So there's a bunch that's important here. One is that Reuters couldn't verify the figures in total and that they really only had this one particular bank record showing a mixing. Now, what did Binance say? Well, in a statement to Reuters, they obviously denied this. Spokesperson Brad Jaff said, these accounts were not used to accept user deposits. They were used to facilitate user purchases. There was no co -mingling at any time because these are 100 % corporate accounts. Reuters goes on.
The Crypto Overnighter
"binance group s" Discussed on The Crypto Overnighter
"To the overnighter. A little bit of attention like that goes a long ways towards getting this show in front of more people. So thank you for that. And as listeners know, signature bank failed last month. New York community Bancorp took over most of the assets in some loans. Clients with crypto related accounts were informed that their accounts would be closed soon. Signet, signature banks, software for crypto transactions in USD. Well, that was in receivership at the FDIC. Despite the turmoil, signature banks collapse didn't affect tether. That's according to Paula Arduino. He's their chief technical officer. However, Bloomberg has reported that anonymous sources claim tether used Signet, signature banks and software. Reportedly, tether did not have an account with signature bank. Now, tether said that they used Signet as one way to connect to the global banking system. Tether also used other banking channels and counterparties to avoid risks and weaknesses. They said they made sure that their entities weren't affected by signature banks collapse. Now currently, it's unclear if tether's use of Signet was approved by signature bank for all such transactions. A former SEC and Treasury Department representative suggested that signature bank may have allowed tether to use Signet as a way of working with a stablecoin company without taking on all the risk. If signature bank allowed the arrangement, it may indicate a high risk appetite. Signature bank may have deemed it less risky than opening an account for tethered directly. Now, signature bank would not have faced legal risks by dealing with tether since the company has never been sanctioned. Additionally, signature bank and its employees have not faced any allegations of wrongdoing regarding their dealings with tether. And let's stick to the subject of signature's closure here. Adrian Harris is the superintendent of the New York department of financial services. And Harris denied that the recent closure of signature bank was related to its exposure to digital assets. She spoke at the chain analysis link's conference in New York City. And she claimed that the events leading to the bank's failure was a new fashioned bank run. Harris also called the suggestion that the closure was due to crypto exposure, ludicrous. Harris called the notion that taking control of signature bank was related to cryptocurrency or choke .2 absurd. She said that without proper liquidity management protocols in place. And with a high percentage of uninsured deposits, a bank can not be considered safe and sound. Signature bank closed on March 12th that was just two days after Silicon Valley banks collapse and four days after silvergate banks announcement of closure. All three banks had close ties to the crypto industry. And also consider the Federal Reserve board's rejection of custodia banks membership application. These events have fueled theories of a coordinated effort by U.S. regulators to disconnect crypto from the banking system. A theory I happen to believe in. This has been called operation choke .2. That's a call out to an earlier effort to disconnect legal, but controversial businesses from banking services. However, Harris believes that this is a silly idea saying that regulators are not attempting to de bank the crypto industry. Paris said that the rules and the guidelines have her department require virtual asset companies to have a solid banking partnership with well regulated banks. She also mentioned that while some in the industry find her department rules burdensome, they provide a clear path for crypto companies looking to operate in New York. Harris stated that having transparent rules in black and white is the best way to grow a strong and responsible ecosystem that can innovate, integrate with traditional financial services, serve customers and make markets more efficient. She also said that it's the quickest way to achieve these goals. Singapore's Central Bank and police authorities have teamed up to help banks in creating consistent standards for assessing crypto account openings. This initiative has been ongoing for around 6 months. Additionally, a separate industry report is expected in the next two months. This report would outline best practices in due diligence and risk management. This report will cover stablecoins, NFTs, and gaming credits, and will also focus on firms that offer payment services. According to a spokesperson for the monetary authority of Singapore, there are no rules preventing banks from working with crypto players. Banks must undertake customer due diligence measures for these customers just as they would for any other current or potential customer. The goal is to comprehend and mitigate the risks associated with these customers. So far, the authority has not prohibited banks from doing business with digital asset firms. However, banks are going to decide whether to accept such clients based on their risk appetite. Now compare this to the U.S. where authorities have been cracking down on banks that serve crypto clients. Resulting in the collapse of several crypto friendly banks, like signature, Silicon Valley, and silver gang. As a result, crypto companies are now looking for banking partners and jurisdictions to conduct their business. India and other countries have previously implemented similar shadow ban measures, their own choke .2, I guess. Dubai's virtual assets regulatory authority is tightening regulations for cryptocurrency activities. Reportedly, vara has asked a binance and other crypto players to provide more information about their business requirements. Three anonymous sources cited by Bloomberg said that varro wants to know about binance's ownership structure, governance and auditing processes. And it's not just binance. Vara is requesting the same information from all global crypto players looking for a license in Dubai. Varra officials have asked binance for more information on its global grip level and board procedures. But it's taking longer to address due to binance's size and complexity. This scrutiny on virtual asset service providers in Dubai adds to binance's problems. The exchange is also facing pressure from U.S. regulators. The U.S. commodity futures trading commission filed a lawsuit against binance and CEO CZ. The CFTC alleges that binance engaged in improper compliance procedures and trading. CZ rejected the claims and said binance doesn't trade for profit or manipulate the market. He called the allegations quote an incomplete recitation effects. In September of last year, binance got a preparatory license from varra. This license permits by units to establish an office in the UAE and to provide digital asset exchange services to pre qualified investors. However, the exchange can not offer locally regulated digital asset services yet. To offer services to qualified investors, binance needs to upgrade to an operational license. After that, it can secure a full market product permit. And so binance needs to submit the necessary requirements to make that upgrade come about. Hex trust is the only digital asset custodian that has an operational license from Dubai. Vara's website states that currently providing their services must comply with their requirements by the end of June. And speaking of binance, asic, the Australian securities and investments commission canceled binance Australia's derivatives license. Asic made the official announcement on April 6th after review of binance's operations. Which means binance Australia derivatives clients can't add or open new positions from April 14th. Users need to close existing derivatives positions before April 21st. The Australian financial complaints authorities membership requirement for binance continues until April 8th, 2024. So we know the Australian securities regulator reviewed binance's financial services business. The review included binance's classification of retail and wholesale clients. Joe Longo is the asic chair, and he said that the review was for compliance with the classification. Longo added that the financial services laws in Australia offer retail clients important rights and consumer protections. Retail clients trading in crypto derivatives also have access to external dispute resolution via the Australian financial complaints authority. Asic statement mentioned the CFTC's lawsuit against binance and CZ. They also said that binance's group entities faced regulatory warnings and actions worldwide. In 2021, global regulators initiated a series of investigations and warnings against binance. Binance chose to close down binance Australia derivatives after engagement with asic. A binance spokesperson said binance would pursue a more focused approach in Australia. Now keep in mind, this is just for the derivatives trading. Spot trading on binance will remain available for Australian residents. The representative added that about 100 users remained. Binance reached out to notify them of the winding down process. And that's going to do it for us tonight. I want to thank you my listeners because when you stop listening, I will stop talking. If you enjoyed tonight's show, then please like follow subscribe. And in the meantime, we'll see you tomorrow night.