regulationNew in the European Union on money laundering and terrorist financing is going to reduce the possibility of anonymous crypto payments. At the same time, the activity of ‘Binance’, the largest crypto trading arena in the world, was banned in the Philippines due to failure to issue a license. The company has also been outlawed in Nigeria, and is struggling to operate in Europe, where it has lost its payment providers.
Binance tried to continue its activities in Russia under a different company name, a move that also failed. The criminal settlement she reached with the authorities of the United States includes A huge fine of 4.3 Billion dollars that she should start paying soon.
Meanwhile, law enforcement agencies in the United States have begun criminal and administrative proceedings against the crypto trading scene KUCOINfor money laundering and violation of customer identification rules.
Sam Bankman Fried is accused of embezzling 8 billion dollars
In the legal proceedings against crypto entrepreneur Sam Bankman Fried The prosecution asked for a sentence in the range of 40-50 years in prison, in a sentence that should be announced in the United States tomorrow (Thursday). Bankman Fried was convicted Last November, a series of criminal offenses, including the embezzlement of 8 billion dollars in customer assets at the scene FTXand has been awaiting his sentence in prison ever since.
The EU is against anonymity in crypto
New economic regulation of the EU, which is designed to fight money laundering and terrorist financing, will make anonymous crypto payments illegal, regardless of the amount of money. This is a proposal that attacks the core of the essence of crypto wallets – Being a technical tool to circumvent regulation of any kind.
Thus, any third party payment such as a crypto trading arena and custodians, will be required to identify the sender of the payment and the recipient. The law will also limit anonymous cash payments to a ceiling of €3,000.
The new regulation will come into full effect within three years, and will limit the ability to make anonymous crypto payments even for those who hold a private wallet, as they will be required to identify themselves with every payment they receive or send to the wallet of a crypto service provider.
Binance’s troubles
The world’s largest trading arena for crypto continues to encounter restrictive regulations. its activity It was banned in the Philippines by order The Securities Authority last Monday, for the simple reason that it did not issue a license to operate in the country. The importance of the decision is actually the definition of the activity of the trading arena to offer securities to the public, a definition that the majority of the crypto industry denies and opposes.
This was preceded by the banning of its activities in Nigeria last June, but it is the country that encountered an unexpected difficulty. Two Binance employees who flew to the country to resolve the disputes between them and the company were placed under house arrest in February. One of them managed to slip away and flee the country in an unclear manner. GodThe other worker remains in custody.
In Nigeria, there is an open criminal investigation against the company on charges of money laundering, and there is a pending indictment against it on the subject of tax evasion and assisting citizens to evade tax. In practice, many Nigerians have resorted to the platform to purchase cryptocurrencies, In an attempt to defend against the severe inflation in the country, which currently stands at about 30%, compared to the level of prices a year ago. About a month ago the state started block access to the websites of several crypto trading arenas, but these blocks can be bypassed with relatively simple means.
As part of the compliance arrangement the company agreed to, it must disengage from operations in Russia due to the Western sanctions regime. The company tried to do this in a clumsy way, by selling the activity to a new company named CommEXexcept that the code of the new company’s website is very similar to Binance’s website, including the use of the same software services (API).
Founder of BinanceCZwho is awaiting his sentence in the United States, even posted on Twitter that clients CommEX will be able to redeem discounts Binance surfers are entitled to them, using the crypto token BNBissued and distributed by Binance.
Meanwhile, on Monday of the week, the announcement of the new society al closing its activity, which will take place on May 10, without stating clear reasons for speaking, when already this week you will stop accepting customers from Binance.
Binance has difficulty operating in Europe, after being abandoned by the payment service providers that agreed to work with it in the past, and connecting it to the banking system in the Eurozone.
This week the company was supposed to make a first payment of almost 900 million dollars out of the huge fine imposed on it, amounting to 4.3 billion dollars, in its plea agreement with the American authorities. The company’s customers have no simple way to make sure that the payment is not made through embezzlement of their assets, since the company operates without financial separation between its assets and the customers’ assets, as required in regulated financial companies.
New lawsuits in the United States against Zirat KUCOIN
In the last day, there has been a dramatic decrease of about a billion dollars in the net worth of the assets in the crypto trading arena KUCOIN, following the filing of lawsuits against her in the United States. According to Reuters, the IsraelCFTC for trading in commodity futures, filed an administrative lawsuit against KUCOIN, The record in the Seychelles, for operating an illegal trading arena, which included the activity of American customers.
An interesting aspect of the lawsuit is the reference to the crypto assetsite (ETH) as a commodity, and not as a security. Yesterday, a lawsuit was also filed against the arena by the Ministry of Justice for violating the rules of money laundering since the beginning of its operations in 2017.
The company announced in response that it “respects the law and regulations of various countries and strictly implements the obligation to obey the law”. The lawsuit was also filed against its two Chinese founders – ChunGanAnd KaTang, without being stopped. The company agreed last December to pay a fine of 22 million dollars, in order to reach a legal settlement with the state of New York.
