Once a Fugitive, Crypto Fraudster Arrested in Türkiye

The world’s largest crypto exchange by volume, Binance and its founder Changpeng Zhao (CZ) have been sued again for money laundering.

As reported by Coinmarketcap, Friday (23/8/2024), according to the new class action lawsuit, Binance deliberately ignored its registration with the relevant authorities and failed to maintain adequate anti-money laundering protocols as a means to profit from the US market.

According to the lawsuit, Binance’s actions caused Binance.com to become a hub for criminals seeking to launder money. The lawsuit further accuses Binance and its founder Changpeng Zhao of putting profits ahead of the law and providing criminals with a way to obfuscate their crimes.

Furthermore, it is alleged that Binance.US, Binance’s US branch, was created for no other reason than to divert the attention of US regulators.

According to Bill Hughes, an attorney at blockchain software firm Consensys, the lawsuit is unlikely to go to trial because Zhao will eventually seek to settle. Hughes said a massive on-chain analysis campaign would likely occur if the case goes to trial.

Asset Tracking

The plaintiffs argue that blockchain records should allow for the tracing of stolen assets. However, Binance’s use of the blockchain allowed criminals to effectively erase the link between stolen assets and their source.

The plaintiffs claim that without Binance’s role in laundering the stolen funds, authorities could have better traced the assets.

So, Binance argues that this will improve the recovery of stolen funds. They argue that this will be possible by retracing the steps on the blockchain.