CFTC to Continue Aggressive Takedowns of Crypto Exchanges: Commissioner
- The United States CFTC will continue to take aggressive actions against non-compliant crypto businesses.
- Commissioner Christy Goldsmith Romero said that the agency will show no tolerance for lax KYC measures.
- “Access to US customers is a privilege, not a right,” Romero said.
- “It should be crystal clear that the CFTC will not stop in its pursuit of non-U.S. entities,” said Commissioner Pham.
The United States Commodity Futures Trading Commission (CFTC) will continue to take aggressive actions against digital asset trading platforms that do not operate under US laws. In a statement, Commissioner Christy Goldsmith Romero confirmed that the agency will not go easy on crypto exchanges that fail to comply with the government, as evident from the recent takedown of the world’s largest crypto exchange, Binance.
According to a report from Business Insider, Romero stated that the actions taken against Binance and its former CEO Changpeng Zhao, also known as CZ in the digital asset space, are just the beginning; more similar takedowns will follow. Zhao pleaded guilty earlier this week to the allegations of the Department of Justice (DoJ), CFTC, and the Securities and Exchange Commission (SEC).
While the past two years have been hard for investors and crypto firms, it is unlikely that the situation will improve in the near future. Zhao and his exchange both pleaded guilty, and the former has to pay a whopping $4.3 billion for failing to comply with anti-money laundering and KYC policies that fall under the Bank Secrecy Act of the United States.
Out of the $4.3 billion, the DoJ will receive $2.018 billion and $50 million from Zhao, while the CFTC will get $1.35 billion from Binance, $150 million from CZ, and $1.5 million from Binance’s Chief Compliance Officer, Samuel Lim. Currently, the former chief executive of the world’s largest crypto exchange is out on a $175 million bail bond. However, the prosecutors are trying to get CZ’s bail bond overturned, claiming he is a flight risk.
Additionally, CFTC Commissioner Romero also said, “There are no pirate ships in US markets,” while adding that “access to US customers is a privilege, not a right.”
She also confirmed that her agency will show no tolerance towards crypto businesses that operate in the United States but integrate lax KYC policies on their platforms. This includes VPNs or any other actions that could circumvent KYC rules, including pop-up questions that merely ask users to attest that they aren’t based in the US.
On the other hand, in another statement, CFTC Commissioner Caroline D. Pham said the agency’s reach has no border while noting:
“It should be crystal clear that the CFTC will not stop in its pursuit of non-U.S. entities.”