The US Securities and Exchange Commission (SEC) has announced the launch of an investigation into the US arm of leading cryptocurrency exchange Binance; Regarding the trading companies associated with Binance CEO (Zhang Bing Zhao).
On Tuesday, the Wall Street Journal reported that the authority and the stock exchanges are discussing the relationship between (Binance US) and the trading companies (Sigma Chain AG) and (Merritt). Beck).
The federal regulator has reportedly requested information from the US crypto exchange about the two companies and is investigating how it disclosed its potential links with market makers to users.
The news outlet also reported that company documents from 2019 as well as former Binance executives link Zhao to both businesses.
Sigma Chain AG and Merritt Peak, as market makers, are constantly buying and selling cryptocurrencies on Binance US, which usually reduces the Price volatility.
It is not clear how the authority and the exchanges would proceed with any enforcement action even if it confirmed that an investigation was under way.
Coin Telegraph reported on Jan. 20 that the regulator has taken 97 enforcement actions against crypto firms, including Poloniex and Blockchain trust partners, with penalties worth $ $2.35 billion between 2013 and 2021.
In May 2021, Binance was reported to be under investigation by both the Department of Justice and the Internal Revenue Service in an effort to prevent US residents from using cryptocurrency in unauthorized transactions. legitimate.
As a March 2021 report noted, the CFTC is also investigating a leading cryptocurrency exchange for US user activity. Binance CEO Changpeng Zhao denied any allegations of misconduct on the exchange at the time.
