On December 12, there were reports that U.S. federal prosecutors could move aggressively against Binance and file criminal charges against several individual executives, including Zhao. Since the 2018 investigation of anti-money laundering laws, Binance had been used for illicit funds transferring as seen as suspected criminal sanctions violations and the evidence was gathered. The crypto markets have been shaken among investors since last month’s rapidly collapsed month of FTX. Binance was cemented regarding bankruptcy, accordingly.
Justice Department regulations say that money laundering charges against a financial institution must be approved by the MLARS chief. Leaders from the other two offices, along with higher-level DOJ officials, would likely also have to sign off on any action against Binance. The charges under investigation are unlicensed money transmission, money laundering conspiracy, and criminal sanctions violations. No final charging decisions have been made, though prosecutors consider Zhao and some other executives to be subjects of the investigation, one source familiar with the situation said.
Binance said in September it would automatically convert user balances and new deposits of USD Coin and two other stablecoins into its stablecoin, Binance USD (BUSD). Then came the considerable increase in USDC withdrawals on December 13, and $3 billion in net withdrawals flowed out of Binance while the lower volume depositing since June as the platform said it had “temporarily paused” withdrawals of the USDC stablecoin. Swapping USDC with two other tokens, It has subsequently restarted withdrawals while other so-called stablecoins tracking the dollar were unaffected.
Published 21/12/2022
By Ashley Jones
