Why Binance opened 90% of closed accounts for investigation

After the collapse of the FTX cryptocurrency exchange, most of the global regulators have stepped up their monitoring of crypto-related activities and platforms such as Binance. As a result, some have opened investigations into most of the prominent cryptocurrency exchanges and trading platforms.

Crypto exchange was Bitzlato under investigation By the US Department of Justice (DoJ). The agency unveiled some facts condemning the money laundering activities on the platform. Subsequently, the US Department of Justice charged the founder and majority owner of the cryptocurrency exchange with unauthorized money transfers.

according to Modern report FinCEN, leading cryptocurrency trading platform Binance, is cited as the most important counterparty to Bitcoin for Bitzlato.

Some massive transactions from Bitzlato used Binance as their landing guard after trying to hide the source of the illicit funds. Hence, Binance closed some accounts on its platform related to the Bitzlato money laundering investigation, as noted by some users.

Customers regret their banned accounts

After the account was banned on Binance, some Russian-speaking customers complained on Telegram. users created A group chat on Telegram on January 18 to complain that they were unable to withdraw funds from their accounts on the exchange. They noted that Binance carried out the action without warning users.

More than 1,000 users are affected by this measure. Users believe their accounts have been banned due to recent US Department of Justice enforcement action against Bitzlato.

Some users have been expressing confusion and anger regarding the action against this cryptocurrency exchange. However, most of the members confirmed that they used their Bitzlato and Binance accounts to complete some transactions.

A chat user advertiser It doesn’t make sense to close accounts related to Bitzlato. He noted that “unless proven guilty, action should not be taken on the basis of mere accusations”, as in the case of Pizzellato. Other members of the chat group classified the action as “illegal”.

Binance opens 90% of previously banned crypto accounts

A Binance spokesperson confirmed that the exchange’s action to close the accounts was related to the Bitzlato investigation case. In addition, the representative noted that the Binance Compliance and Investigation Team has suspended several accounts of clients from several countries with the CIS and Eastern Europe.

Moreover, the spokesperson noted that the measure was temporary as the exchange opened 90% of the frozen accounts. Binance notified users of the decision to reopen their accounts with all funds intact.

However, the representative mentioned that less than 20 accounts are still banned. The exchange has issued all necessary law enforcement documents to the affected users.

In addition, Binnace directed its users to Exchange Policy To understand some of the reasons why an account might be banned by the platform. This knowledge will help users avoid illegal transactions in the trading venue.

Binance CEO Changpeng Zhao (CZ) noted the exchange’s active efforts to prevent illicit money transfers on the platform. For example, on January 16, Czechoslovakia mentioned How Binance was instrumental in freezing the accounts of a group of hackers and helping Huobi crypto exchange recover 124 BTC.

Featured image by Pixabay, Teapic | Charts by TradingView.