The U.S. investigation into crypto exchange Binance has expanded to include possible insider trading and market manipulation, Bloomberg writes.
The inquiry has included the officials looking into whether Binance or its staff made money by taking advantage of its customers.
The review involves the Commodity Futures Trading Commission, which has been looking into possible witnesses. Binance isn’t based in any single country, but has a wide-ranging operation where clients buy and sell digital tokens, with values of tens of billions of dollars. Government watchdogs haven’t been involved, for the most part.
Because of this, the exchange has had a view into “millions of transactions,” Bloomberg writes.
U.S. authorities have been investigating whether the firm has exploited that access, and whether it was trading on customer orders before executing them.
A Binance spokesperson has said the company has a “zero-tolerance” policy for insider trading, along with strict rules to make it so misconduct can’t happen.
Compliance has been an issue for Binance in the past, with more nations increasingly demanding that the company and affiliates stop offering services within borders. The complaint is that the company lacks the proper licenses.
Binance has not been accused of wrongdoing, and the regulatory actions thus far haven’t led to any charges. And the company as a whole hasn’t been alone – the rise of digital currencies has been closely monitored by several agencies, including the Treasury Department, the Federal Reserve and the SEC, worrying about the possibility of illegal activity going on and the lack of protections for customers.
For instance, the CFTC has been looking into whether Binance has let U.S. residents buy or sell bitcoin derivatives, and has been seeking internal data to that effect. Because Binance isn’t registered in the U.S., it shouldn’t be allowed to do any of that.
PYMNTS reports that in early September, South African regulator Financial Sector Conduct Authority (FSCA) said the public needed to be vigilant about Binance, due to its lack of regulation and the potential to lose money if “something goes wrong.”