Binance, the world's largest exchange for digital assets, in June announced a partnership with Manchester United player Cristiano Ronaldo. As part of the partnership, the Portuguese was to release his NFT series on the BINANCE platform by the end of this year. Now there are reports that the exchange has been implicated in fraud, through which investors have lost a considerable amount of capital.
Accusations against Binance
London police reported that the total amount of funds that came from illegal activities reported to Action Fraud (the UK's national cybercrime reporting center) is ?36 million for 2021 alone.
Although there is no evidence that Binance carried out improper activities contributing to the theft of investors' funds, law enforcement authorities claim that the exchange unknowingly processed transactions originating from illegal activity.
In response to these allegations, the exchange announced that it is in the process of creating “the most sophisticated cyber forensics team in the world.” Binance added that it enjoys good cooperation with law enforcement agencies in every country where it operates.
For example, the platform some time ago returned ?260,000 to a victim of one of its scams. The assets were reportedly linked to Binance. The exchange maintains that the decentralized nature of its ecosystem of digital assets allows it to implement reliable safeguards on other platforms where cryptocurrency trading takes place.
Binance is a platform that brings together buyers and sellers of cryptocurrencies in one place. Additionally, it provides its users with digital wallets to store their assets. In 2017, the exchange giant released its own native BNB token, which can be traded both on Binance and other cryptocurrency trading venues.
The exchange is responding to the allegations
Binance's global head of intelligence and investigations – Tigran Gambaryan – in response to the above accusations, asked the police why the institution did not provide data regarding the activities of competing cryptocurrency exchanges. He also announced that Binance will focus on seeking information on where the ?36 million figure, which the report specifically refers to the token and the Binance wallet, came from.
Gambaryan noted that Binance supports its coin, however “not controlling it”. In addition, he pointed out that “it's not a typical action for law enforcement to identify a specific company in this way”.
Binance and Scams in the UK
In a summary of its report, London police report that last year there were 9288 complaints from all cryptocurrency trading platforms and projects that are related to fraudulent activities regarding such assets. Police also conveyed that the average victim lost ?21,620.
According to official figures, fraud related to Bitcoin alone across all platforms last year caused losses worth a total of ?110 million. For that, Scams related to unspecified cryptocurrencies amounted to ?41 million, and procedures related to Ethereum, the second largest cryptocurrency in terms of market capitalization, amounted to ?11 million.
Law enforcement authorities, however, remain skeptical of investors' entry into the cryptocurrency market. The Public Prosecutor's Office in London is concerned about the lack of a system to protect investors in the sector.
In 2021, the city's regulator banned the Binance exchange from conducting any regulated activity in the UK. In doing so, the institution cited that the exchange was “unable” to be supervised by regulators for certain activities and posed a “significant risk to consumers".
Although Binance has been blacklisted, the Financial Conduct Authority (FCA) does not have the legal power to prohibit investors from using Binance.
According to a report submitted in response to a Freedom of Information (FOI) request, Binance-related cryptocurrency thefts accounted for 17% of the ?204 million in 2021, the total value of stolen assets reported to police.
Translated and published with permission fromhttps://comparic.pl/londynska-policja-twierdzi-ze-binance-jest-zamieszane-w-oszustwa-kryptowalutowe-o-wartosci-36-mln-funtow/
