Wednesday, April 21, 2021
Home Crypto News Market Binance Under CFTC Investigating Over Derivate Trading

Binance Under CFTC Investigating Over Derivate Trading

- Advertisement -

US Commodity Futures Trading Commission (CFTC) began investigating Binance activities due to concerns that it allows US citizens to trade cryptocurrency derivatives in violation of the law.

CFTC is trying to find out if Binance allowed US residents to buy and sell cryptocurrency derivatives. If this is true, then Binance violates US laws since Binance is not registered with the CFTC, the agency said.

Binance CEO Changpeng Zhao said the exchange does not have an official headquarters in the US, so the investigation will not lead to enforcement action. The CFTC treats Bitcoin and Ethereum as exchange commodities, which is why futures contracts are under the jurisdiction of the CFTC. Platforms offering such products to US citizens are required to comply with strict regulatory requirements, regardless of their location.

Zhao stated that the exchange did not take any action that violates US law. Zhao said that he usually does not comment on interactions with regulators. According to him, this investigation does not mean that the department is trying to bring charges against the exchange.

The Binance founder suggested that his competitors might bribe or pressure journalists to publish abusive material containing false information. Zhao cited the example of Forbes, which last year published an article about the “Tai Chi organization” against Binance. Binance later sued Forbes but dropped the claim last month.

Zhao added that Binance takes regulatory compliance seriously and is implementing appropriate measures to combat money laundering. The exchange will continue to interact with international regulatory bodies to improve compliance with industry standards.

The head of Binance said that the exchange does not allow American traders from accessing its main website, and also uses advanced technologies to detect suspicious activities. However, users can always find clever ways to bypass restrictions. Zhao said regulators are enforcing too strict rules for cryptocurrency firms.

After this news, Bitcoin fell to $54,960, while the value of BNB fell to $247.5. Zhao tweeted that Fear, Uncertainty, and Doubt (FUD) is common in a bull market. Zhao urged users not to panic.


US regulators are stepping up measures against the cryptocurrency industry. In 2019, the BitMEX trading platform also came under close scrutiny from the CFTC. Last fall, Coinbase management reported that during the first half of 2020, the exchange received more than 1,900 queries from law enforcement agencies, including the CFTC.

- Advertisement -
Albert Brown
Albert Brown
Albert Brown has obtained his master's degree in Stock Trading And Investing. His specialty is analyzing the price actions of crypto and stock markets. Albert provides a major role in TheCryptoBasic as a crypto analyst. He is also known for his work on Twinkle Magazine and TipRanks.


Please enter your comment!
Please enter your name here

- Advertisment -

Recent News & Articles

Chiliz CEO Alexandre Dreyfus Announced Working On Chiliz Chain V.2

Chiliz CEO Alexandre Dreyfus has announced that they are working on the next version of Chiliz Chain. With the new version, users will be...

Binance list FC Barcelona Fan token

Cryptocurrency exchange Binance has announced that it will list the FC Barcelona Fan Token (BAR). The BAR will initially be listed in the exchange...

Cryptocurrency Fund Launches To Combat Volatility In Bitcoin

Backed by venture capitalist Mark Carnegie of MH Carnegie & Co., in partnership with leading global blockchain expert Sergei Sergienko. Marks the entry...

Gaming Giant Ubisoft Has Become A Validator In Tezos Network

The French gaming giant Ubisoft, known for Assassin's Creed and Far Cry, has joined the ecosystem of the Tezos blockchain platform as a corporate...

Subscribe To Our Newsletter

Get Updated with All The latest Crypto News, Articles, Reviews, Analysis and much more. Delivered Every Monday.

follow us in feedly