Changpeng Zhao, or CZ, the founder and CEO of Binance, says he wants to do something to prevent “intelligent” US traders from entering his global exchange illegally.
CZ said his exchange wants to be “smarter on how we block” US traders from getting entry to the site in an interview with Bloomberg. He was quoted saying:
“Basically, we do continually try to improve our blocking. There are sometimes a few guys who want to circumvent our blocking and still use the platform and we have to come up with a smarter way to protect that and when we do, we block them.”
On Friday, CZ clarified to Bloomberg that Binance.US is a distinct organization that licenses Binance technologies and provides branding assistance from the Malta-based exchange.
Centralized Crypto Exchanges in Flux?
Only last month, a civil compliance case against the BitMEX derivatives exchange was brought by the Commodity Futures Trading Commission or CFTC for running an unregistered brokerage.
Several crypto exchanges have failed to establish a foothold in the US due to its heavily regulated nature.
Around the same moment, the Department of Justice is demanding federal penalties for the management of BitMEX over the facilitation of money trafficking to and from the US.
Trading levels on Binance.US are said to be just a slight fraction of the regular amount of volume on the regular Binance exchange.
Recorded amounts, though, are often exaggerated and do not reflect real trade operation. Huge exchanges continue to publicize bogus amounts of volume, as Cointelegraph has stated.
In response, new AML and trade monitoring steps to root out bad actors have been reported by the exchange.
Binance’s Rise to #1
Binance is a cryptocurrency exchange that offers a forum for swapping different cryptocurrencies. Binance was the world’s biggest centralized crypto-currency platform in terms of market value as of January 2020.
Changpeng Zhao, a developer who had previously developed high-frequency trading tools, founded Binance. Initially, Binance was founded in China, but later migrated out of China due to China’s growing cryptocurrency regulations.
In 2005, CEO Changpeng Zhao had previously developed Fusion Systems in Shanghai; the business installed high-frequency broker trading systems.
As the third member of the cryptocurrency wallet squad, he joined Blockchain.info in 2013. He also operated for less than a year at OKCoin as CTO, a forum for spot trading between fiat and digital assets.
The business was established in China, but in anticipation of the Chinese government’s ban on cryptocurrency trading in September 2017, it relocated its servers and headquarters from China and Japan. By March 2018, the group had set up offices in Taiwan.
It was the biggest crypto-currency exchange with a market capitalization of $1.3 billion as of January 2018.
In March 2018, after tighter legislation in Japan and China, Binance declared its plans to open an office in Malta. Binance concluded a memorandum of understanding (MoU) with the Bermuda government in April 2018.
A related memorandum with the Malta Stock Exchange to establish a forum for exchanging security tokens was signed months later.
Binance, which is the world’s highest-volume crypto exchange, stopped servicing US traders over regulatory risks in Sept 2019.
Binance.US was launched in conjunction with BAM Trading Services, which is allowed to allow American customers through the Financial Crimes Compliance Network.