Senators Elizabeth Warren, Chris Van Hollen, and Roger Marshall have joined in sending a letter to Changpeng “CZ” Zhou, demanding information pertaining to the operations of Binance, the crypto exchange he founded.
The three Senators request that CZ provide “information regarding growing concerns over the finances, risk management, and regulatory compliance of Binance, Binance.US, and other related entities.”
Following the collapse of FTX, along with multiple other failures during 2022, the anti-crypto rhetoric has risen inside the beltway. The letter notes that Binance is now facing investigations regarding money laundering and more. These “disturbing allegations” have compelled the Senators to request information from Binance, including:
- Complete copies of all Binance and Binance subsidiary balance sheets from 2017 to the present.
- An estimate of the number and percentage of U.S.-based Binance users during every fiscal quarter between 2017 and the present
- Any and all documents and communications relating to an alleged plan to create an entity called Tai Chi that may have “distracted regulators with feigned interest in compliance.”
- All policies regarding AML/CFT/KYC for Binance, Binance.US, and any subsidiaries
- Information on allegations that CZ told employees, not to KYC users
- Policies regarding Binance’s relationship with Binance.US
- A list of US-based firms that have used Binance
The letter claims that in the years since its founding, Binance has faced “increasingly disturbing allegations regarding the legality of its operations.”
It would be surprising if Binance provided the requested information.
What is clear is that scrutiny on both domestic and international digital asset firms is increasing, and Binance is a pretty fat target for US regulators.
The Senators have given CZ until March 16, 2023, to provide responses.