Global cryptocurrency exchange Binance has asked prime brokers, including FalconX and Hidden Road, to strengthen their customer screening process to prevent U.S. investors from participating in the exchange, Bloomberg reported on the matter. It was reported Tuesday, citing an informed source.
Because prime brokers primarily serve institutional investors, the scope of information requested by their clients includes the geographic location of their offices, founders, and employees. report. We also require customers to verify their information to ensure its accuracy.
Cryptocurrency exchanges have been demanding additional information from prime brokers for their customers since Binance pleaded guilty to U.S. charges in November, the report said.
Binance did not immediately respond to The Block’s request for comment.
Binance after guilty plea
Binance and its former CEO Changpeng Zhao admitted to violating the Bank Secrecy Act last year. The U.S. Department of Justice announced a settlement with Binance on charges of money laundering, fraud, and sanctions violations, which resulted in the exchange paying a $4.3 billion fine.
“Changpeng Zhao built Binance, the company he founded and ran as CEO, into the world’s largest cryptocurrency exchange targeting U.S. customers, but refused to comply with U.S. law.” Acting Deputy Attorney General Nicole M. Argentieri of the Justice Department’s Criminal Division said this in an announcement last November.
Binance’s U.S. subsidiary, which was hit by a lawsuit from the Securities and Exchange Commission along with Binance and Zhao in June of last year, argued as follows: More than two-thirds of the staff had to be laid off. After revenue fell 75% following enforcement action.
But following Zhao’s guilty plea and subsequent resignation, the global exchange appears to have become more powerful. Increase from $67 billion to $112.5 billion According to data From DefiLlama. This may be due to the record surge in Bitcoin value over the past few months.
Binance is said to still be the world’s largest cryptocurrency exchange in terms of trading volume. CoinMarketCap data.
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