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February 8, 2022

Binance on Making the Crypto Industry Safer For Users

Decentralization, which eliminates intermediaries and empowers people to control their own money, is at the heart of the cryptocurrency industry. With decentralization as the primary purpose of digital assets, it is no surprise that regulation appears to have no place in this industry. While this is a popular position among cryptocurrency users, history has shown that it is myopic.

Investing in a lesser-known asset class that exists in the “Wild West” has minimal impact on investor confidence. As a result, as the value of bitcoin assets continues to rise, the media has been quick to highlight the numerous scams, insider trading, and market manipulation schemes, including but not limited to pump and dump schemes.

These risks are in addition to the less visible ones, such as the reliability of an online exchange or the possibility of interest-earning platforms going bankrupt. These issues may be alleviated through regulation, and even the most skeptic investors may be eager to invest in cryptocurrencies.

Currently, industry leaders such as Binance, one of the world’s largest cryptocurrency exchanges, have made it their mission to solve mounting regulatory issues. When it comes to regulation, the CEO of Binance, known as CZ, encourages consumers to compare bitcoin restrictions to those of an automobile.

He claims:

“When the car was first invented, there weren’t any traffic laws, traffic lights, or even safety belts. Laws and guidelines were developed along the way as the cars were running on the road.”

Recognizing the need of regulation, it is not surprising that Binance has made it a part of its commitment to guaranteeing user safety while traversing the cryptosphere. By doing what they teach, the exchange remains compliant with all regulatory obligations, even before regulators impose these restrictions.

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Binance was among the first cryptocurrency exchanges to maintain a safe asset emergency fund, which was one of these measures (SAFU). The fund, which is expected to be worth USD 1 billion by the end of January 2022, is made up of a percentage of all trading fees that occur on the platform, offering a level of security to all platform users.

Other prominent efforts include collaboration with a number of law enforcement agencies to identify bad actors and hold them accountable for their acts. As part of their expanding efforts, the exchange has looked to organizations such as CipherTrance, a platform known for automating bitcoin Anti-Money Laundering (AML) compliance through API usage. The team also conducts AML audits, with a number previously cleared.

Binance’s dedication does not end with these laws, as they have just expanded their compliance staff. Many former FATF officials have joined the ranks, with a 500 percent rise from the previous year, to ensure the team complies with all local rules applicable to where they are working.