U.S. prosecutors are said to be considering filing criminal charges against the world’s largest cryptocurrency exchange, Binance, and its top executives for possible money laundering and sanctions violations, according to Reuters.

Key Takeaways

  • U.S. federal prosecutors are said to be looking at filing money laundering charges in a years-long investigation of major crypto exchange Binance.
  • Such a development in the long-running Binance case could add further downside to a rattled crypto industry, if it were to occur.
  • Binance CEO Zhang dismissed the talk as fear, uncertainty, and doubt, known as “FUD.”

DOJ Split Over Charging Binance

However, disagreement within the U.S. Department of Justice (DOJ) exists about moving aggressively against the exchange and filing criminal charges against some executives, including founder Changpeng “CZ” Zhao. Some at DOJ are said to want to take longer to review more evidence, according to reports.

This is the latest development in the long-running investigation of Binance that started in 2018 and is focused on the company’s compliance with U.S. anti-money laundering laws and sanctions.

Zhao Defiant Against Latest ‘FUD’

In a thinly veiled tweet on Dec. 12, Zhao, 45, said: “Ignore FUD. Keep building!” The exchange also tweeted a communication shared with Reuters, saying their reporters “had it wrong again.” Binance also said in a blog statement that it was “possibly even the strongest in the entire financial sector” in terms of security.

Binance and its CEO have been instrumental in reacting to the recent collapse of the FTX exchange, which rocked the industry. First, as rumors of FTX’s insolvency began to circulate, Binance pulled the plug on $529 million in FTX token holdings, a move that undermined its now-bankrupt rival. Zhao has been a leader in trying to bring further transparency and guidance to other industry participants.

The Bottom Line

Earlier this year, Binance pointed out in a blog post that of all 2021 transactions made with cryptocurrencies, only 0.15% were associated with some type of illicit activity. Although this might give some investors hope, there is no denying that authorities are cracking down on crypto firms, especially after the FTX collapse.

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