Reuters Blasts Binance For $2.35b Money Laundering Problem

Key Takeaways

  • A brand new report from Reuters claims Binance allowed greater than $2.35 billion price of prison funds to course of by means of its alternate unchecked.
  • Entities believed to have laundered cash by means of Binance embody a North-Korean hacking syndicate and the previous largest darknet drug market on the planet.
  • Binance is alleged to have been a straightforward alternate to launder cash by means of attributable to its beforehand lax KYC necessities.

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A report from Reuters claims that Binance could have allowed the laundering of greater than $2.35 billion over a interval of 5 years. The report highlighted situations when North Korean hackers, Russian drug sellers, and European organized crime teams allegedly processed cash by means of the alternate.

State Hackers, Drug Sellers, and Organized Crime

Binance, one of many largest cryptocurrency exchanges on the planet, could have let billions of {dollars} price of hacked funds transact by means of its platform, a brand new investigative report from Reuters has discovered.

In line with the report, Binance allegedly processed greater than $2.35 billion of stolen funds between 2017 and 2021. The funds (the full of which was calculated from court docket data, legislation enforcement statements, and with the assistance of blockchain evaluation companies) are stated to have originated from on-chain hacks, funding frauds, and unlawful drug gross sales. Blockchain analysis agency Chainalysis has acknowledged that Binance processed $770 million of prison funds in 2019 alone.

The Reuters report singles out entities having allegedly laundered cash by means of Binance, together with the Lazarus Group, the North Korean cybercrime syndicate chargeable for hacking $550 million from the Ronin bridge final yr. Whereas Binance labored with legislation enforcement to determine and freeze $5 million from the hack, the quantity that did achieve passing by means of the alternate is unclear.

Hydra, an enormous Russian-language darknet market that used cryptocurrencies for the sale and buy of medicine, can be stated to have used Binance to course of greater than $780 million since early 2018. 

The report lastly particulars that European organized crime teams focused pensioners in Germany, Austria, and Spain, and should have laundered greater than $800 million of faux buying and selling web site positive aspects by means of cryptocurrency exchanges, notably Binance.

Binance was the cryptocurrency alternate of selection, the report says, due to its beforehand unfastened know-your-customer (KYC) id verification checks. Certainly, visitors between Binance and Hydra dropped sharply after the KYC necessities had been tightened in August 2021.

When requested to touch upon the Reuters investigation, a Binance spokesperson instructed Crypto Briefing that “the article makes use of outdated info from 2019 and unverified private attestations as a crutch to ascertain a false narrative” earlier than highlighting Binance’s cooperation with legislation enforcement in a number of cybercrime investigations.

Disclosure: On the time of writing, the writer of this piece owned ETH and a number of other different cryptocurrencies.

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