- Binance is the subject of an investigation at the CTFC into whether the exchange allowed US traders to use the platform.
- Changpeng Zhao denies the news as FUD
According to a report from Bloomberg, Binance has come under fire from the U.S. Commodity Futures Trading Commission (CFTC). The issue concerns whether the exchange allowed its U.S. users to trade crypto derivatives. To investigate this, the authority has launched an investigation.
As is well known, the regulatory environment in the U.S. is complicated to some degree, as the CFTC has jurisdiction over all commodities – Bitcoin has been classified as one of them. To that extent, the CFTC claims jurisdiction over Bitcoin as well as crypto derivatives and futures. Any exchange that offers trading in these instruments must therefore be directly approved and supervised by the regulator.
Binance is not registered with the CTFC. Therefore, according to the report, the CFTC is concerned that Binance has allowed trading of the aforementioned instruments and commodities without informing them. However, Binance is reportedly not accused of any wrongdoing. Moreover, it is said that people familiar with the matter suspect that the investigation will not lead to enforcement action.
Remarkably, the news comes a day after the exchange hired former U.S. Senator for Montana and former ambassador to China, Max Baucus, as a policy advisor to navigate the exchange’s relationship with U.S. regulators.
Meanwhile, Binance CEO Changpeng Zhao responded to the breaking news with a tweet, commenting, “It’s not a bull market without some FUD.”
It’s not a bull market without some FUD.
Ignore FUD, keep BUIDLing.
— CZ 🔶 Binance (@cz_binance) March 12, 2021
The Binance Coin (BNB) price reacted immediately to the news and was down about 14% at press time.