US Regulator Investigate Binance BNB Token Probe By U.S. Money Laundering and Tax

 

June 6, 2022 (Reuters) - The U.S. Securities and Exchange Commission (SEC) is investigating whether crypto exchange Binance Holdings Ltd’s initial coin offering in 2017 broke the agency’s rules, Bloomberg reported, citing people familiar with the matter.

SEC investigators are examining if the offering of BNB token amounted to the sale of a security that should have been registered with the agency, the report here said on Monday.

The investigation adds to the troubles for Binance, one of the world’s largest crypto exchange, which is already plagued by legal issues and controversies.

Spokespersons for SEC and Binance did not immediately respond to Reuters requests for comments. (Reporting by Leroy Leo in Bengaluru)

 

The U.S. Securities and Exchange Commission (SEC) is examining whether Binance’s initial coin offering of its Binance coin (BNB) token in 2017 was an unregistered security offering that should have been registered with the regulatory agency, Bloomberg reported Monday, citing confidential sources.

• Without commenting on the details of the reported probe, a spokesperson for Binance told CoinDesk via email, "As the industry has grown at a rapid pace, we have been working very diligently to educate and assist law enforcement and regulators in the U.S. and internationally, while also adhering to new guidelines. We will continue to meet all requirements set by regulators."
   
  • BNB was trading down 4% after news of the report came out.
  • Binance is currently under investigation in the U.S. by the Justice Department, the Commodity Futures Trading Commission (CFTC) and the Internal Revenue Service. Binance is the world’s biggest crypto exchange and says it’s not domiciled in any one country.
  • The SEC is also investigating market-making companies owned or partially owned by Binance CEO Changpeng Zhao that do business with Binance.US, a U.S.-based affiliate of the global exchange, according to a person familiar with the review, Bloomberg reported.
  • According to the report, one of the SEC’s focuses is on whether Binance.US is wholly independent of the global exchange and whether employees may be involved in insider trading.
  • An SEC spokesperson declined to comment on the existence of any possible probe.