The United States Department of Justice marks a milestone in the cryptocurrency market by imposing extraordinary supervisory measures on Binancethe main exchange cryptocurrencies Worldwide.
These measures, revealed through recently disclosed compliance commitments, represent a significant leap in US government surveillance about the commercial and operational activities of this company.
This step is a radical change in the world of cryptocurrencies, pointing towards an era of stricter regulation and supervision in an area that has long defended its autonomy and decentralization.
The analysis carried out by John Reed Stark, former official of the Securities and Exchange Commission (SEC), describes these new commitments as a “consultant wish list“, suggesting that they could seriously impact the operations of the platform, even leading to its closure. This approach highlights the possible intrusion and strictness of the US government in the world of cryptocurrencies.
The Scope of DOJ Oversight of Binance is unprecedented in the history of financial regulation. The agreement between the DOJ and Binance reveals an extensive list of evidence, including Binance’s admitted “Statement of Facts”, “Compliance Commitments”, and a detailed description of the DOJ’s “Compliance Monitoring”. This supervision, in which FinCEN also participates, is unprecedented for a global financial institution.
Binance: the new commitments it assumes
The new commitments cover various areas, from policies and procedures to internal controls and anti-circumvention measures, which are estimated to cost Binance tens or hundreds of millions of dollars in implementation and maintenance costs. Furthermore, the scope of the DOJ-appointed Compliance Monitor is so broad that it requires a 13-page document just to provide a summary of Binance’s obligations.
This scrutiny is not limited to the DOJ and FinCEN. It involves multiple divisions of the DOJ, reflecting the seriousness with which the US government views Binance’s operations. The level of cooperation required is astonishing, including unlimited access to company documents, records, facilities and employees, with the monitor authorized to report directly to the government in cases of misconduct that endanger national security or obstruct justice.
These government oversight actions create unique opportunities for investigations and findings that could trigger further accusations against Binance, its founder. Changpeng Zhao (CZ) and other related entities.
In short, the settlement with the DOJ and FinCEN places Binance under unprecedented government surveillance. This level of supervision, as intrusive as it is constant, it raises questions about whether a discreet entity like Binance can adapt to being transparent and compliant with laws. Unrestricted regulation appears to be heading towards an end, and Binance’s future under this new regime will be a crucial test for the cryptocurrency regulatory landscape.
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