- The media has been informed that the CEO of Binance has actually admitted to fictitious trading.
- The transaction in question is a $70,000 transaction in BTC that occurred in the first hour after the launch of Binance.US.
- The exchange’s official response is that neither Zhao nor the company was ever involved in such a thing.
In a private correspondence, Binance cryptocurrency exchange CEO Changpeng Zhao admitted to fictitious trading on the US-based unit during its launch in 2019. This was reported by the WSJ, citing internal correspondence.
“I think it was ourselves,” the company’s CEO allegedly said.
Remember, in the first hour after the start of trading on Binance.US in 2019, there was a $70,000 movement in BTC. The WSJ publication, citing its sources, says it was a deliberate action.
Similar practices are banned in traditional financial sectors not only in the U.S., but in most countries around the world. Fictitious trading is market manipulation that inflates economic indicators, attracting traders and additional capital, the publication specified.
The WSJ also cites another example. The article publishes two instances where Binance.US employees approached then-head of operations Catherine Cowley for clarification about illegal activity on the platform.
On one occasion she ignored the request, and on the second she directly reiterated the fact that the exchange had no leverage over it. In a comment for CoinDesk, a spokesperson for the company denied the publication’s report. According to him, neither the exchange nor Changpeng Zhao has ever been involved in such a thing.
Reminder, the U.S. Securities and Exchange Commission filed a lawsuit against Binance and its head in early June. In its response, the company and its management denied all allegations.