The Paris prosecutor’s office announced on Friday that Binance, the world’s largest cryptocurrency exchange, is under preliminary investigation for alleged illegal canvassing of clients and money laundering. This development marks another setback for the prominent crypto platform, which has recently faced regulatory challenges.
The investigation focuses on suspicions of “the unauthorised practice of the profession of virtual assets service provider” and “aggravated money laundering,” according to a statement from the prosecutor’s office.
In response, a spokesperson from Binance acknowledged that the exchange had undergone an “on-site visit last week by the relevant authorities” in France. They emphasized Binance’s full cooperation with the authorities and compliance with obligations.
The spokesperson also highlighted the company’s commitment to user privacy, stating that information about users is securely held and only disclosed to government officials when accompanied by appropriate justification.
Binance and its CEO Changpeng Zhao have recently faced legal action from the U.S. Securities and Exchange Commission (SEC). The charges include operating an unregistered securities exchange and failure to restrict U.S. customers from the platform. Binance has disputed the SEC’s allegations.
In response to news of the French investigation, Zhao took to Twitter, dismissing it as “FUD” – a term used in the crypto community to refer to negative or fear-inducing news. Zhao emphasized that it was not newsworthy in his perspective.
As the investigation unfolds, Binance continues to operate amidst a complex regulatory landscape, facing scrutiny from multiple jurisdictions. The outcome of these legal challenges will have significant implications for the future of the exchange and the wider cryptocurrency industry.
