Changpeng Zhao, the CEO of Binance, has revealed many new efforts to attain greater legal compliance. Binance, the world's largest cryptocurrency exchange, has announced that it will abandon its decentralized operational model in favor of a central headquarters.
Binance is relocating its headquarters to a more central location.
Binance's founder and CEO, Changpeng "CZ" Zhao, has announced the exchange's plans to establish a consolidated headquarters in a specific area.
Binance will abandon its decentralized operating architecture in order to be more legally compliant, Zhao confirmed in a Wednesday interview with the South China Morning Post.
The CEO, on the other hand, did not reveal where the exchange will be based.
Despite being a centralized company, Binance began in 2017 and has followed a decentralized business strategy for years. It has a number of locations all around the world.
The exchange stayed outside the authority of any single country due to its decentralized style and lack of a set headquarters. However, new plans to operate from a consolidated headquarters are likely to necessitate complete legal registration.
Zhao explained why the exchange has chosen to operate from a single location:
“Regulators inquire, 'Where is your headquarters?' and we reply, "Well, we don't have a headquarters." Regulators aren't happy about that. They have no idea how to collaborate with us. They even think we're shady at times.”
Binance had already registered in the Cayman Islands and opened a branch in Malta, but neither government has granted it a license to operate.
Binance has come under fire from banking regulators all over the world in the previous year. Various nations have issued warnings to the exchange for providing trading services without a license, including the United Kingdom, Poland, Italy, Japan, Malaysia, Singapore, and Thailand. Furthermore, earlier this year, the US Department of Justice and the Internal Revenue Service were said to be looking into the exchange.
While operating from an official site exposes the company to new regulatory restrictions, it should also increase compliance. Zhao explained how the upgrade will make working with regulators easier:
“We need to be centralized for the centralized exchange business. We need a consolidated company with clear investors, good board governance, transparent KYC/AML procedures, and robust risk controls behind it.”
Binance is demonstrating its commitment to cooperate with regulators by establishing a centralized legal organization. As it has come under scrutiny in recent weeks, the exchange has taken a number of other efforts to comply, including lowering leverage limits, requiring new users to complete a mandated KYC process, and employing a former IRS inspector to combat money laundering. The most recent action is another step in appeasing regulators and obtaining the requisite licensing to serve its clients globally.
No comments:
Post a Comment
Note: only a member of this blog may post a comment.