Binance Aids Chinese Customers in Evading Regulations... $90 Billion Cryptocurrency Transactions Detected

The Wall Street Journal (WSJ) reported on the 2nd (local time) that Chinese users traded $90 billion (116.775 trillion KRW) worth of cryptocurrency on Binance, the world's largest cryptocurrency exchange. China has classified cryptocurrency trading as illegal, but Binance was found to have helped Chinese customers evade regulations.

[Image source=Reuters Yonhap News]

WSJ revealed that over two years from 2021, $90 billion worth of cryptocurrency was traded through Binance in China. The volume traded in the Chinese market accounted for 20% of the total global cryptocurrency trading volume conducted through Binance.

Previously, when Chinese authorities imposed a complete ban on domestic cryptocurrency trading in 2021, Binance announced it would fully withdraw its exchange operations from China. It also promised to convert Chinese customers' accounts into withdrawal-only accounts, prohibiting further trading.

However, WSJ reported that Binance secretly helped Chinese users evade regulations to continue trading. According to internal Binance documents obtained by WSJ, Binance encouraged Chinese users to visit other websites with Chinese domain addresses before routing their trades through overseas exchanges, thereby assisting in circumventing regulations. WSJ stated that these documents began circulating within the company after Chinese authorities started blocking cryptocurrency exchange sites in 2017.

Additionally, Binance is suspected of maintaining close business ties with China. According to a report by Cointelegraph in March, Binance reportedly maintained an office in China at least until 2019, even after officially announcing its withdrawal from the Chinese market. Cointelegraph also reported that employee salaries were paid through Chinese banks.

WSJ stated, "Binance did not strictly enforce identity verification procedures for Chinese users," adding, "In the months following the 2021 trading ban imposed by authorities, less than half of all Chinese users completed identity verification procedures."

This content was produced with the assistance of AI translation services.