Unlike its creator Binance, Binance. US, which is open to American investors, does not allow highly leveraged crypto-derivatives trading, which is regulated in the U.
The leaked Tai Chi document, a slideshow believed to have been seen by senior Binance executives, is a strategic plan to execute a bait and switch. While the then-unnamed entity set up operations in the United States to distract regulators with feigned interest in compliance, measures would be put in place to move revenue in the form of licensing fees and more to the parent company, Binance.
All the while, potential customers would be taught how to evade geographic restrictions while technological work-arounds were put in place. The source says the document was created by former Binance employee Harry Zhou, a serial entrepreneur, who is the co-founder of Koi Trading, a San Francisco-based cryptocurrency exchange partially owned by Binance.
Still, an analysis of the document reveals that many of the specifics outlined within it, are already in place. One of the slides from the leaked slideshow, purporting to show how the "Tai-Chi Entity" could be connected to Binance. The first goal, enforcement mitigation, is designed to minimize the impact of U.
More specifically, it describes a detailed strategy for distracting the U. To do this, the document advocates for participating in the U. A representative of the Department tells Forbes that Binance. US did participate in the Cornerstone program, as a standard part of the process of becoming a Money Service Business, but declined to comment further.
Another CipherTrace client is the U. While the SEC declined to comment as to whether or not its engagement of CipherTrace was part of a larger investigation into Binance or Binance. Essentially, it would be a decoy. The document lays out a plan for its new subsidiary to be FinCEN compliant initially in at least 30 U. However, the permission stopped short of a full BitLicense, which may just be part of the plan.
US, the Tai Chi entity, has not yet become a member. In August Binance. While Coinbase never publicly mentioned Binance. US as the reason for its departure, a Coinbase representative confirmed that lax vetting prompted its exit from the association. Specifically, Coinbase has concerns that Binance. Among crypto exchanges Binance is renowned for its execution speed, unique incentives and for its willingness to flout convention.
Binance was founded in China in the summer of by Changpeng Zhao, 44, a cryptocurrency veteran with prior experience at bitcoin wallet provider Blockchain LLC and cryptocurrency exchange, OKCoin. Like other crypto-exchanges, the company makes money by charging trading fees, margin interest fees, futures fees and deposit and withdrawal fees. Unlike other cryptocurrency exchanges though, Binance makes its own digital currency, the BNB coin.
While the global market for spot trading cryptocurrency is rather easy to access, derivatives, where investors can leverage their investment by as much as X, are highly regulated in the U. Traders flock to Binance, in part because of the leverage they can employ.
Parent company, Binance is currently known to be Cayman Islands based but the exchange first launched in Shanghai. Later as the Chinese government cracked down on cryptocurrency trading, the company moved its headquarters to Japan and then Malta.
Last April Binance launched a distributed exchange, or DEX, that purports to directly connect counterparties in a trade without the direct involvement of Binance or any other middleman. Rossen Iossifov, 53, formerly of Bulgaria, was convicted by a federal jury in Frankfort, Kentucky of one count of conspiracy to commit racketeering and one count of conspiracy to commit money laundering after a two-week trial in front of U.
District Judge Robert E. Sentencing has been set for Jan. According to court documents and evidence presented at trial, Iossifov and his co-conspirators participated in a criminal conspiracy that engaged in a large-scale scheme of online auction fraud that victimized at least Americans.
Specifically, Romania-based members of the conspiracy posted false advertisements to popular online auction and sales websites—such as Craigslist and eBay—for high-cost goods typically vehicles that did not actually exist. Members of the conspiracy would convince American victims to send money for the advertised goods by crafting persuasive narratives, for example, by impersonating a military member who needed to sell the advertised item before deployment.
According to court documents, members of the conspiracy created fictitious online accounts to post these advertisements and communicate with victims, often using the stolen identities of Americans to do so. They also delivered invoices to the victims bearing trademarks of reputable companies in order to make the transaction appear legitimate.
Members of the conspiracy also set up call centers, impersonating customer support, to address questions and alleviate concerns over the advertisements. According to court documents, once victims were convinced to send payment, the conspiracy participants engaged in a complicated money laundering scheme wherein domestic associates would accept victim funds, convert these funds to cryptocurrency, and transfer proceeds in the form of cryptocurrency to foreign-based money launderers.
From at least September to at least December , he exchanged cryptocurrency into local fiat currency on behalf of the Romania-based members of the conspiracy, knowing that the Bitcoin represented the proceeds of illegal activity. The investigation was conducted by the U.
Attorneys Kathryn M. Anderson and Kenneth R. Taylor of the U. Tips to avoid becoming a victim of online auction fraud can be found here on the U.
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