Jun 1, 2023

Binance Faces Further Regulatory Troubles as Ontario Securities Commission Initiates Investigation

The world's largest cryptocurrency exchange, Binance, finds itself in yet another regulatory predicament as the Ontario Securities Commission (OSC) has issued an investigation order against the company. Documents reveal that the OSC aims to determine if Binance has attempted to circumvent securities laws.

In response to the investigation order, Binance announced its decision to cease operations in Canada, citing "new guidance related to stablecoins and investor limits." The exchange subsequently requested the Securities Commission to drop the investigations, asserting that they were overly broad and lacked a factual basis.

Binance emphasized in its filing on May 18 that the investigation order served no legitimate purpose, emphasizing that it had already exited Ontario and Canada. A hearing to determine the potential dismissal of the investigation is scheduled to take place on June 2, according to documents from the Capital Market Tribunal.

Canada has proven to be a challenging environment for crypto firms, as other major exchanges, such as Bybit and OKX, have also announced their departure from the country due to regulatory reasons, including new regulations.

Binance's regulatory woes extend beyond Canada, with multiple major regulators, particularly those in the United States, closely scrutinizing the exchange. The Commodity Futures Trading Commission (CFTC), Securities and Exchange Commission (SEC), and Internal Revenue Service (IRS) have all initiated investigations into Binance. Additionally, the Department of Justice reportedly considered aggressive action against the exchange or further review based on accumulating evidence.

In April, Binance and its CEO, Changpeng Zhao, faced a $1 billion civil lawsuit from lawyers, accusing them of promoting unregistered securities and engaging in collaborations with celebrities to facilitate such activities. The investigations into Binance intensified following the bankruptcy of FTX, a prominent cryptocurrency exchange, in November, as U.S. attorneys sought communication records between financial firms and Binance due to its proximity to the collapsed competitor.

As regulatory pressures mount, Binance faces a tumultuous period marked by legal challenges and ongoing investigations that could significantly impact its operations and reputation in the cryptocurrency industry.

News stream

See More News

Get the best Alpha & Market Analysis with a FREE NFT pass

Get NFT Pass