Binance, the leading cryptocurrency trading platform, is taking steps to tighten its controls and prevent access to its platform by investors from the United States. According to Bloomberg, sources familiar with the matter reveal that Binance has directed prime brokers, such as FalconX and Hidden Road, to implement more rigorous checks on their clients. The exchange has recently halted its services in several countries due to regulatory policies and increased scrutiny.
Binance has been actively focused on enhancing its compliance measures following the guilty pleas made in November. The platform is now demanding additional information from institutional traders, including details about office locations, employee whereabouts, and founder residency. All these checks are accompanied by signed attestations to ensure the accuracy of responses.
The catalyst for these stringent checks can be traced back to Binance’s plea deal, whereby they admitted to violating US anti-money laundering and sanctions laws, resulting in a hefty $4.3 billion penalty. The Department of Justice (DOJ) criticized Binance for targeting US customers and deliberately ignoring American legislation. Allegations were made that Binance employees actively solicited US VIPs to provide misleading information about their location.
In response to queries about these stricter checks, Binance reiterated its commitment to compliance and transparency. The exchange also highlighted its Binance Link Program, which aims to provide trading and connectivity services to enterprises.
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