Finally, after the short tweet that read just ‘4’, Binance CEO Changpeng Zhao has come up with a much lengthier response to the charges raised against Binance by the US Commodity Futures Trading Commissions (CFTC).
The response from Chanhpeng Zhao was posted through a post on Binance’s blog.
In his post, Changpeng Zhao stated that the complaint filed against him contains incomplete facts and also that he and his company do not agree with the characterization of different issues that are mentioned in the complaint filed by the CFTC.
In his response to the lawsuit, Changpeng Zhao also added that his company Binance does not trade for profit or manipulate the market under any circumstances.
He said that the operations and trading policies of Binance were under his strict observation Zhao ended the response on another that said that he and his company does not expect everything to be easy but that they also do not shy away from challenges.
Many people believe that the response is a hint that Zhao and his company are ready for a legal fight and that they are not ready to back down easily.
While the company is being sued by the CFTC, they still continue to proceed with its operations in the international market, which is more friendly and welcoming of crypto platforms.
The United States Commodity Futures Trading Commission has raised charges against Binance on the ground of allegedly violating the trading and derivatives law in the United States.
A complaint against Binance was filed by CFTC on Monday which accused the crypto firm of having an ineffective compliance program and also of knowingly breaking the law regarding crypto restrictions in the country.
Along with Chanpoang Zhao, the CFTC also charged cases against the former chief of compliance for Binance violations through intentional conduct that undermined the compliance program from Binance.
According to the claims of the agency, the executives of the company along with Zhao and Lim failed in supervising the operations of the company, and their lack of supervision added to the violations committed to the laws of the United States.
Apart from the charges mentioned above, the lawsuit filed by the CFTC against Binance and its executive members includes some other internal issues regarding the firm too. The information that led to the addition of this issue in the lawsuit was brought out through a report from The Wall Street Journal.
According to the report that was published earlier this month, Binance gave instructions to their customers in the United States to use Virtual Private Networks (VPN) so that they could continue trading on the platform, even though there is a restriction imposed by the government against it.
While the global platform Binance.com is restricted to users in the United States, they have access to Binance.US which is a variation of the website for users from the United States. Binance.US operates as a separate entity from Binance.com.
The company has received different criticisms in the past for the secretive nature of the business and also for the fact that Changpeng Zhao has also not been exactly transparent with the operations of the company.
The lawsuit filed by the CFTC against Zhao, Binance, and other executives of the company reflects the concern of the authorities over the security and the trust in crypto exchange platforms following the collapse of Sam Bankman Fried’s FTX.
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After the collapse of FTX, Binance took the title of the world’s largest cryptocurrency exchange platform and was also an active participant in the events that led to and also followed the collapse of FTX.
The terminal slide of FTX was triggered after the announcement of Zhao to sell off his shares of the FTX token FTT. This alerted the investors who withdrew their money immediately fromFTX, eventually leading to a very unstable situation at the company.
During the time of crisis, Binance came up with a solution and offered to bail out FTX by taking over the company but they did not see it through. Binance backed out of the deal just a single day after making the offer and FTX was eventually foiled for bankruptcy.
Following the turmoil in the crypto sector, the government and authorities are more vigilant in order to avoid another possible crash of the market that could affect the investment of common people.
The Federal Trade Commission began its investigation into different crypto firms for any kind of misconduct last year along with the Securities and Exchange Commission.
Recently, the SEC charged Kraken crypto exchange with a $30 million fine for allegedly selling unregistered securities, and most recently, the SEC also charged Justin Sun, the founder of Tron for his crypto scheme along with eight other celebrities who were paid to promote the scheme.
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