Binance Lays Out Response to Regulatory Clampdown

The exchange will need to target the issues that have led to their platform being restricted in several nations.

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BSCNews
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July 27, 2021
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BSC News

Binance Responds to Concerns

Binance has officially responded to recent regulatory restrictions with their plans to work with authorities. The changes were made necessary by recent news that countries are warning the exchange due to a lack of permission to operate. The CEO of the exchange, CZ, indicated the company’s roadmap to compliance in a series of Tweets.

“We will actively work with regulators as more crypto-specific frameworks are introduced” The CEO Tweeted.

In particular their efforts will be focused on countries where the exchange has been officially prohibited from operating.

Tax Reporting Tool

In the Twitter thread, CZ detailed the specific steps Binance is taking to become compliant. The exchange introduced a new tax reporting tool in order to simplify the reporting process.

CZ stated the tool will “track crypto activities and connect to third party tax vendors to streamline reporting requirements.”

One of the major issues that cryptocurrency as a whole has faced is tax evasion concerns. While there are no doubt intentional abuses of cryptos to avoid paying taxes, many users are simply confused as to the exact process. 

Introducing this new Application Programming Interface (API) will make reporting taxes from transactions on the exchange a much simpler task.

Futures Have a Cap

Binance has also changed the requirements for leverage trading on futures accounts. According to their official update, accounts will now have to be active for more than 60 days to use leverage over 20x. 

The limits will gradually increase after the account has reached the 60-day threshold.


KYC Efforts Intensify

In an effort to increase user security the exchange will also be increasing their Know Your Customer (KYC) standards. According to CZ, daily BTC withdrawal limits will be lowered for accounts that have only passed the Basic account verification from 2BTC to 0.06 BTC. This decreases the ability of bad-faith traders to manipulate the market.

Binance Faces Scrutiny

Despite being the top global cryptocurrency exchange, Binance has seen some controversy recently. Multiple countries have warned Binance they are operating without a license to do so in that country. 

Some countries have even banned the exchange outright. One such ban is in the U.K, who warned users that their funds may not be safe with the exchange. 

Binance Still King of the Hill

The recent spate of regulatory clampdown focused on Binance was disconcerting to many. Binance will have to ensure that its operations are compliant, which it has undertaken in a dedicated manner.

The recent clampdowns have taken a slice off Binance’s market share. Making payments and withdrawals to and from the exchange is restricted by certain banks. This inconvenience is balanced by the wide range of products and services offered by Binance. 

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