- The Commodity Futures Trading Commission (CFTC) recently launched a case against Binance.
- The lawsuit describes Bitcoin, Ether, Binance USD, Tether and Litecoin as commodities.
- CFTC has alleged market manipulation and a failure to comply with regulations.
Changpeng ‘CZ’ Zhao, CEO of Binance, has strongly contested the claims made against the cryptocurrency exchange and himself by the US Commodity Futures Trading Commission (CFTC) in their March 27 lawsuit.
On March 27, the CFTC issued a 74-page complaint that labelled Bitcoin (BTC), Ethereum (ETH), Binance USD (BUSD), Litecoin (LTC), and Tether (USDT) as commodities and also accused Binance and Changpeng Zhao of market manipulation and lack of compliance.
The agency further accused Binance of not responding to the investigative subpoenas sent by the commission, as well as obscuring the location of its executive offices.
CZ declares CFTC’s allegations incomplete
In a blog post, the Binance CEO refutes the allegations and explains that:
“Binance.com does not trade for profit or “manipulate” the market under any circumstances. Binance “trades” in a number of situations. Our revenues are in crypto. We do need to convert them from time-to-time to cover expenses in fiat or other crypto currencies. We have affiliates that provide liquidity for less liquid pairs. These affiliates are monitored specifically not to have large profits.”
The CFTC has also accused Binance of trading on its own platform using 300 “house accounts” without properly disclosing the information to its customers in its Terms of Use. The agency claims that the exchange has instead kept the information as a “top secret” and even refused to answer the investigative subpoenas looking for details about the said trading activity.
CZ further revealed that he has two accounts with Binance: one for the card and one for crypto holding. He states in the blog post:
“Personally, I have two accounts at Binance: one for Binance Card, one for my crypto holdings. I eat our own dog food and store my crypto on Binance.com. I also need to convert crypto from time-to-time to pay for my personal expenses or for the Card.”
