- Brazilian authorities have launched an investigation into Binance on allegations of financial crimes facilitated through crypto derivatives.
- The investigation was reportedly launched following a tip-off from the Brazil Securities and Exchange Commission.
- Binance has denied offering derivatives in Brazil, and stated that it is collaborating with regulators to comply with their obligations.
Brazil Launches Investigation Into Binance
Brazilian authorities have confirmed the launch of an official investigation into world’s largest cryptocurrency exchange, Binance. The probe concerns allegations that the exchange failed to respond to a stop order, directing it to stop selling crypto derivatives.
Tip-Off From Brazil SEC
The investigation was reportedly prompted by a tip-off from the Brazil Securities and Exchange Commission (Comissão de Valores Mobiliários – CVM). The CVM informed the Attorney General of Sao Paolo that Binance allegedly ignored a “stop order” issued by the state. As a result, it purportedly offered crypto derivatives to Brazil users in contravention of legal requirements. Consequently, both the Federal Police and Federal Prosecutor’s Office are now involved in the probe.
Binance Denies Offering Derivatives In Brazil
So far, Binance has refused to comment on any ongoing investigations. Nonetheless, it has categorically denied offering any type of derivatives in Brazil. According to documents from Comissão de Valores Mobiliários, they had issued the aforementioned stop order back in 2020 after which Binance stated that it would cease offering crypto derivatives in Brazil. However, staff members discovered they could access these offerings by altering language settings on either its app or website.
Collaborative Approach To Regulators
In response to inquiries made about its operations within various jurisdictions around the world — including those overseeing cryptospace — Binance noted its collaborative approach when dealing with regulators while also stressing its commitment to compliance obligations.