Binance in trouble, blockchain security standard: Blockheads

A Forbes report accused Binance, the world’s largest cryptocurrency exchange, of attempting to deceive US regulators. China got its first blockchain security standard, and processed digital yuan transactions almost doubled in the last month. Bitmain closed another big sale of Antminers to the US, and a new cross-chain protocol was integrated to the BSN.

The Binance papers

An allegedly internal Binance document obtained by Forbes said that the cryptocurrency exchange banned from China in 2018 was trying to set up a complicated corporate structure to deceive US regulators and aid customers in evading US laws, the site said.

Binance denied the accusation. The founder and CEO of the company took to Twitter to question the document’s authenticity.

FUD. The statements and accusations in the article are incorrect. The whole article hinges on a 3rd party document. The said document was not produced by a @Binance employee (current or ex). Anyone can produce a “strategy document”, but it does not mean Binance follows them. 1/7

— CZ Binance (@cz_binance) October 29, 2020

The document in question dates back to late 2018, when Binance was setting up a US subsidiary, according to Forbes. It speaks of a plan to set up a company, dubbed “Tai Chi Company” in the document, to distract US regulators while Binance was working on regulation workarounds.

Binance US, the exchange’s on-the-books subsidiary, would go along with US compliance requirements and would not allow highly leveraged derivatives trading, the document said. Trading crypto derivatives is highly regulated in the US.

Meanwhile, the “Tai Chi Company” would feign interest in compliance, while it was teaching investors on its platform how to evade geographical restrictions and trying to find technological workarounds. The company would return revenues to Binance as licensing fees.

Binance is the world’s largest cryptocurrency exchange, trading on average $10 billion per day. (Forbes)

Government blockchain moves

  • Chinese regulators released the first industry standard for security in blockchain technology. The standard was implemented on Oct. 1 and includes 62 provisions and has been approved by the Ministry of Information Technology. (National Internet Emergency Response Center, in Chinese)
  • The government of Chengdu in the southwestern province of Sichuan released a plan to integrate blockchain in government and become a blockchain development hub by 2022. The city plans to use blockchain for traffic control, hazardous waste management, supply chain traceability, cross-border trade, intelligent manufacturing, and agriculture, as well as develop a testing ground for the digital yuan. (Red Star News, in Chinese)
  • China should be proactively participating in the setting of global digital currency and digital tax standards, President Xi Jinping said in a statement on Saturday. (Coindesk)

The digital yuan

  • The governor of the People’s Bank of China, Yi Gang, said digital yuan pilots have processed RMB 2 billion ($299 million) in 4 million transactions so far. On Oct. 6, the central bank’s deputy governor said RMB 1.1 billion had been processed in 3 million transactions. (BNN Bloomberg)
  • Huawei’s newest smartphone, the Mate 40, will come with a built-in digital yuan wallet, the company said in a Weibo post. The wallet will feature “hardware-level security, controllable anonymity protection, dual offline transactions,”

New blockchain partnerships

  • Bitmain closed a deal to sell 10,000 of its newest cryptocurrency mining rigs to Marathon Group, a US-based crypto investing company. Bitmain signed a contract for 10,500 Antiminer S19s with Marathon Group in August, and another for 17,595 with Core Scientific in June. (Globe Newswire)
  • Poly Enterprise, a permissioned cross-chain protocol, became available to developers on the Blockchain Services Network today. (Poly Network official Twitter)

Binance in trouble, blockchain security standard: Blockheads

Leave a Reply

Scroll to top