Binance and its owner CZ have been accused of a lot of shady behavior. CZ is currently in defense mode on Twitter/X due to new accusations. They've been accused of the following:
- Wash trading: artificially inflating the volume on the exchange by buying and selling assets to controlled wallets. Sigma Chain and Merit Peak are alleged to be actively manipulating Binance volume. They are some of the biggest traders on Binance and are thought to be controlled by CZ or high-level Binance employees.
- Commingling and diverting customer funds: mixing assets in outside accounts which is risky for customers and illegal, ala FTX. An account controlled by CZ at Merit Peak is thought to have received and then transferred to an outside account some $20 billion in customer funds. $145 million is thought to have been used to purchase a yacht.
- Money laundering: helping to conceal the source of ill-gotten money and moving it to circumnavigate the law. Binance has been accused of having intentionally lax anti-money laundering measures.
- Breach of Russian sanctions: helping Russian oligarchs move money to foreign accounts to get around economic sanctions. Because of these accusations, Binance is pulling out of Russia. The company is selling the Russian wing of Binance to CommEx, an exchange that is only days old, is essentially the same as Binance, and whose ownership is not known. CZ denies having any ownership or control.
I don't know about you guys, but CZ seems to be a pretty shady character. Maybe all these accusations are false. Of course, they've denied everything. Do you trust them?
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