Ali Raza
Leading cryptocurrency exchange, Binance has said that it blocked access to $1 million worth of crypto owned by a Tezos tool contributor. The exchange had been called out for freezing the account without providing explanations.
Binance confirms restricting $1M corporate account
Binance released a Twitter thread on Thursday, confirming that it had frozen an account belonging to Baking Bad, a tezos staking rewards auditor. The Tezos tool contributor alleged that Binance froze its account containing Bitcoin, Ether, Tether, Polygon, and other assets without explaining.
However, the exchange has denied the claims made by the Tezos contributor. The exchange said that Baking Bad was aware of the actions taken by the exchange, adding that the contributor had been advised several times regarding their account status.
The exchange further added that Baking Bad’s misleading the community as to why the account was frozen would not change anything. The exchange said that it was obligated to comply with law enforcement requests, similarly to other exchanges.
Binance also advised the tool contributor to follow the procedure in contesting asset seizures with the responsible government agency. However, the exchange had no control over the decision, and the funds would remain frozen unless the law enforcement agency mandated otherwise.
Neither the exchange nor Baking bad has provided the name of the agency that ordered the account freezing. Binance and its subsidiaries operate in many countries globally. On the other hand, the Linked page of Baking Bad shows that the company is based in Estonia. The crypto regulatory framework in Estonia requires that companies offering crypto services comply with anti-money laundering laws.
Binance efforts to achieve regulatory compliance
In its early years, the exchange expressed a commitment to promoting decentralization by not having any headquarters and ensuring that users could hold their assets on the exchange without worrying about interference by third parties.
However, the global crypto regulatory framework has changed, and Binance is now moving towards achieving full regulatory compliance to maintain its status as the world’s largest exchange.
In April, the exchange announced it had restricted the accounts of Russian citizens and residents to ensure they cannot access Binance spot, futures, and custody wallets. Before these changes, Binance’s CEO, Changpeng Zhao, had said that the exchange was mandated to comply with sanctions, just like any traditional financial institution.
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This article was written for Business 2 Community by Ali Raza.
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