02.09.202110:14 Forex Analysis & Reviews: Binance faces scrutiny from financial regulators

Binance is facing scrutiny from financial regulators worldwide. Some of them are prohibiting the exchange from providing certain services, others point at the lack of a license for conducting certain operations.

Binance is the world's largest exchange platform. In July, its trading volume reached $455 million, which is almost three times less than in the previous month. Despite that, Binance is still considered number 1 exchange in the world, according to CryptoCompare.

The exchange is a leader in terms of derivative cryptocurrency trading. The volume of its derivative cryptocurrencies exceeded $1.4 trillion in July, which is 55% of the total market.

Binance, headed by Changpeng Zhao, the Chinese-Canadian commonly known as "CZ", offers users around the world a wide range of services, from cryptocurrency and derivatives spot trading to loans and exchange tokens.

Binance Coin, is the world's third-largest coin with a $68 billion turnover.

Binance has an untransparent corporate structure. Its holding company is registered in the Cayman Islands, according to British court documents and the Securities Commission of Malaysia.

The exchange currently lists over 1,000 job openings on LinkedIn in the UK, the Netherlands, Hong Kong, Singapore, Taiwan, etc.

In the previous week, De Nederlandsche Bank accused Binance of money laundering. It has also been reported that the exchange is under investigation by the Justice Department and Internal Revenue Service.

It is unclear how hard the regulators have hit Binance. Nevertheless, the exchange has made several steps under pressure from regulators. In the previous month, Binance CEO Zhao said he wanted to improve relations with regulators by seeking regulatory approval and creating the regional headquarters.

Binance also scaled back some of its range of crypto products that regulators may oversee. To make sure that all their products are fully compliant, Binance has been limiting their futures, derivatives products in most of Europe, with users in Germany, Italy, and the Netherlands among those first affected. It has also restricted the trading of derivatives for Hong Kong users. In July, Binance also stopped selling digital tokens linked to shares after regulators tightened control. Binance also would stop offering crypto margin trading involving the Australian dollar, the euro, and the pound sterling. Last week, the firm appointed a former US Treasury Criminal Investigator to serve as its International Money Laundering Reporting Officer.