A new report from the Wall Street Journal has shed light on insider communications between Binance and Binance US, revealing that the two entities may have been less compartmentalized than previously believed. The messages reportedly discuss how best to deal with regulatory oversight, which is a major point of interest for any business eager to do business in the United States.
Binance.US was set up shortly after Binance, with the aim of separating the business procedures necessary for compliance with US regulators from those applied to the rest of the world. However, the report suggests that Binance’s early days may have been fraught with the issues typical of dotcom startups.
If US regulators were able to regulate Binance, such rules would have been imposed on the platforms’ offerings worldwide. For instance, derivatives would have been off the table, as companies that offer them in the US fall under the jurisdiction of the Commodity Futures Trading Commission.
The report comes at a time when Binance is facing increased scrutiny from regulators around the world. Earlier this year, the UK’s Financial Conduct Authority (FCA) banned Binance from operating in the country, citing concerns over its anti-money laundering (AML) and counter-terrorism financing (CTF) measures.
Binance has since announced a series of measures aimed at improving its compliance procedures, including the appointment of a new CEO and the creation of a new advisory board. However, the latest report suggests that the company may still have some way to go in terms of addressing regulatory concerns.
The news is likely to be of concern to Binance’s investors, who have seen the value of the company’s native token, BNB, fall by more than 50% since its all-time high in May. However, it remains to be seen whether the latest revelations will have any long-term impact on the company’s fortunes.
