Changpeng Zhao responds to the CFTC’s complaint

The CEO and founder of Binance, Changpeng Zhaopublished a letter in answer at prosecutions launched yesterday by the American regulator CFTC.

On Monday, the U.S. futures regulator, the CFTCfiled a complaint against Binance and its founder for violating the Commodity Exchange Act and CFTC regulations.

Following the announcement, Changpeng Zhao aka CZquickly addressed his 8.3 million followers on Twitter, tweeting simply ” 4 “.

4

– CZ 🔶 Binance (@cz_binance) March 27, 2023

In a previous tweet, CZ had indicated that “4” meant “Ignore FUD, fake news, attacks, etc.” The leader later elaborated on the situation in a blog post.

The CFTC has filed an unexpected and disappointing civil complaint, despite our working with the CFTC for over two years. After an initial review, the complaint appears to contain an incomplete statement of facts, and we disagree with the characterization of many of the issues alleged in the complaint,” the crypto mogul said.

Among other things, the CFTC’s complaint alleges that Binance has been soliciting U.S. users since 2019 – and up until today.

“We blocking American users by nationality (KYC), IP (including VPN endpoints commonly used outside the US) […] We know of no other company using more comprehensive or efficient systems than Binance,” Zhao wrote in his letter.

The crypto billionaire noted that Binance has more than 750 employees in its team dedicated to the compliance and that the exchange intended to work with regulators around the world, including the United States.

At Bloomberg, Yankun Guo, a partner at the law firm Ice Miller, commented on the case and noted. the extraterritorial reach of U.S. agencies.

What is even more fascinating, however, is that they have labeled BTC, ETH, LTC and at least two fiat-backed stablecoins, USDT and BUSD, and other virtual currencies as ‘commodities’. This which is in direct disagreement with the SEC and shows the confusion caused by the lack of clear regulation in the United States,” he added.

The U.S. securities regulator SEC, on the other hand, believes that cryptocurrencies under proof-of-work, such as Ethereum, are securities.

In recent months, following the surprise bankruptcy of FTX, U.S. regulators have gone after several crypto giants, including exchange Kraken and Paxos, Binance’s partner on the BUSD . Last week, Coinbase received a warning in the form of a wells notice.

In parallel to the CFTC’s complaint, a federal judge has suspended the Binance.us/Voyager transaction at the request of the government, reports Coindesk.

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