Tuesday, October 19, 2021
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CFTC investigates market manipulation and insider trading





Reading time for the article: 2 Minutes

Compact:

  • Binance is getting more and more pressure from various regulatory authorities around the world.
  • After only warnings have been issued so far, the situation continues to escalate.
  • Now the CFTC is investigating Binance for market manipulation and insider trading.

The situation is not getting any better for Binance. Although the company tries to get a clean coat of paint and clearly signals that it wants to catch up in regulatory terms, there is no rest. The opposite is the case, because as Bloomberg claims to have learned, the CFTC is investigating Binance Holdings Limited.

Accordingly, the US authority wants to find out whether Binance should have exploited the insight into the customers’ transactions for its own benefit. Specifically, it’s all about insider trading and market manipulation. As things stand, the authority is not bringing charges and it is also being examined whether individual employees could not have benefited from the company.




The CFTC has not yet confirmed the investigations. Binance, on the other hand, rejected the allegations, referring to the strict internal guidelines. But these will no longer be sufficient in the future, because a voluntary commitment does not amount to supervision by the authorities.

Binance has to settle down

Probably the biggest problem is the flying headquarters of the world’s largest stock exchange. For years, people have avoided having to comply with the strict requirements of Western countries.

That was only understandable, because the regulatory ambiguity would certainly have made the business model impossible or at least endangered. As the lawsuit against Ripple and the latest action by the SEC against Coinbase and Uniswap show, even companies that want to comply with the requirements are moving in a minefield.

Now it is time for Binance to catch up and, in addition to the confessions, also take action. Recently rumors have been circulating that it may no longer be safe to trade or keep its deposits on the stock market. Many investors have become nervous because it is not clear how the stock market wants to catch up. It is still not too late for Binance to regain the trust of the authorities and customers.


Hasan Sheikh
Hasan, who loves technology and games, is studying Computer Engineering at Delhi JNU. He has been writing technology news since 2016.
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