The Securities and Exchange Commission (SEC) recently disclosed employee chat records from Binance, causing damage to its reputation. Binance CEO Changpen Zhao (CZ) sent an internal letter to employees following the incident. In the letter, he acknowledged the importance of building new products during challenging times but stated that regulators would request access to chat logs. CZ also stated that disgruntled employees’ comments may exist, but Binance has always maintained high ethical standards, putting customer protection above everything else.

Cryptocurrency Expert Exposes Challenging Details

The chat logs that the SEC released from former company employees Sam Lim and Alvin reveal problematic details about Binance’s operations and compliance practices. Lim, Binance’s former head of compliance, expressed concern about the company’s compliance procedures’ inadequacy and its inability to satisfy regulatory requirements. In addition, Cochran discovered that Binance’s business objectives usually outweighed compliance training and procedures. Lim also made a damning statement saying that “there is no fking way we are clean” which suggests knowing violations of policies. He also discussed the possibility of facilitating high-level trading without following the proper compliance procedures.

The SEC identified several flaws with funds, such as money transfers from Binance International for many Binance.US withdrawals, internal discussions where Binance International members exchanged USD for BUSD and could not figure out why.

CZ’s internal letter emphasized Binance’s commitment to upholding ethical standards and securing its users. However, this SEC investigation and the disclosure of employee chat logs underscore transparency and compliance’s importance in the cryptocurrency industry. Compliance and transparency are essential for the industry’s long-term growth and success, particularly as regulators continue to scrutinize the industry.

Featured image from Unsplash, chart from TradingView.com