According to a Reuters article published on Monday, the U.S. Department of Justice (DOJ) may soon finish its years-long investigation into allegations of money laundering and “criminal sanctions breaches” at Binance.
Whether or whether the DOJ should bring criminal charges against Binance’s senior leadership is now a matter of debate among federal prosecutors engaged.
Binance responded to the Reuters piece head-on with a blog post explaining its extensive crypto crimefighting measures and a tweet providing the whole answer.
The Reason Why
Prosecutors at the Department of Justice are now debating whether or not to drop their years-long criminal investigation against Binance, which may ultimately decide the future of crypto and the Web3. The Department of Justice’s (DOJ) Money Laundering and Asset Recovery Section (MLARS) and National Cryptocurrency Enforcement Team (NCETF) began investigating Binance in 2018. The investigation centers on the exchange’s suspected collaboration in several international money laundering operations.
Some federal prosecutors, according to the Reuters report citing four people familiar with U.S. law enforcement and Binance’s internal advisory policies, believe that criminally charging Binance’s top executives with “unlicensed money transmission, money laundering conspiracy, and criminal sanctions violations” is the appropriate course of action should the DOJ move forward and close the investigation.
To set the record straight, Binance’s official Twitter account published its complete answer to Reuters. In its reaction, Binance points out that Reuters failed to discuss the internal measures Binance has taken to prevent criminals from utilizing its platform.
The inquiry continues to throw a long shadow over the dominant cryptocurrency exchange, and conversations inside the DOJ have stalled for the time being. Nonetheless, regulatory compromise might serve as a path ahead that ultimately satisfies all parties involved.
The Internal Revenue Service and the Securities and Exchange Commission have spent all of 2022 working toward establishing guidelines for the fledgling crypto and NFT industries. The NFT industry as a whole may benefit from some kind of monitoring, and companies like Yuga Labs have readily cooperated with inquiries into the legality of their activities and compliance with U.S. legislation. A sad reality about the developing Web3 ecosystem may emerge if the DOJ decides to take serious action against Binance in the coming months.
When do we go on to what
Since the recent demise of FTX, Reuters has recognized the possible harm a formal complaint against top crypto exchange Binance would wreak on the crypto community, noting the arguments of Binance’s defense counsel against proceeding with criminal charges against its leadership.
The ripple effect of such a decision would be devastating. The current state of affairs leaves Binance with almost no competition in the cryptocurrency market. The Reuters article states that in October of 2022, Binance’s trading volumes were over $1.6 trillion, which is far more than the $230 billion that its largest rival, FTX, handled during the same month.
When Binance suffers, the whole cryptocurrency trading and investment community feels it. And it would hit home — a bitter reality of Web3 that stands in stark contrast to its egalitarian promise. Web3 is beginning to resemble the alternative internet that developers like the Ethereum team have labored to create now that there are no real rivals left to challenge Binance.
How come therefore, does Web3 put so considerable emphasis on decentralization? Let’s quickly review this with one of the most important architects in the history of the universe. Joseph Lubin, co-founder of Ethereum, discussed the motivations behind the Web3 construction boom on a panel at the just finished Gateway event. “Bad centralized systems have hurt many people for centuries. “There are several methods to conceal data and deceive an examiner,” Lubin stated. Continuing his defense of decentralization by using FTX’s demise as an example, Lubin said, “I’m pleased that it is going to allow us to develop a narrative that really lays out, in stark terms, the importance of decentralization.”
Perhaps Binance is a more unified business than its old rival. However, this does not lessen the severity of the issue: Binance is the unchallenged leader of the cryptocurrency world. With so much at stake, the future of decentralization, crypto, NFTs, and the Web3 is at a crossroads.