Key Data

• Trading Name: Binance
• Legal Entity: Binance Holdings Limited, Binance Holdings (IE) Limited etc
  
• Activities: Crypto trading and payment platform
• Location: United Kingdom, Lithuania, Bahamas, Seychelles
• Regulations: regulated
• Key People: Changpeng Zhao, Richard Teng

Binance is perhaps the world’s largest crypto trading and payment platform, with a cleverly woven global spider web of companies spanning regulatory regimes since its inception in 2017.  The Binance network is not transparent to outsiders. Some Binance companies are owned by the people who run them or by top management. There is no recognizable corporate structure and thus no clear responsibility. Binance is a globally dominant crypto behemouth.

Legal Issues Worldwide

In November 2024, Binance’s co-founder and former CEO, Changpeng Zhao, along with Binance itself, admitted to violating U.S. financial laws and sanctions against Russia. Investigations revealed that Binance had been used for laundering money by fraudsters and terrorist organizations. In a historic settlement with U.S. authorities, including the CFTC and FinCEN, Binance agreed to pay $4.3 billion.

As part of the settlement, Zhao resigned as CEO and was sentenced to four months in prison in April 2024. Richard Teng has since taken over as the new CEO.

Additionally, in February 2024, two Binance managers were arrested in Nigeria and charged with illegal transactions, money laundering, and tax evasion. Among them was Tigran Gambaryan, a U.S. citizen and former IRS agent who served as Binance’s Vice President and Compliance Officer.

Problems with Credit Card Networks

Binance has lost its partnership with Visa, which means that debit cards will no longer be available from December 2023.  In June 2024, it was reported that Binance would again issue a MasterCard debit card. MasterCard announced that it had reviewed Binance’s procedures and was therefore reopening the debit card service.

Illegal Online Casinos

Via Binance Pay, the crypto exchange is also active as a payment processor in the high-risk area as well as in the illegal online casino and gambling sector. It is therefore incomprehensible that the credit card companies are entering into a partnership with Binance again. However, it is not unlikely that credit card services will be suspended again if further violations are detected.

Customer Experience

Until recently, Binance had a scam rating of 1.5 stars on Trustpilot. Currently, Trustpilot is informing on the Binance profile page that there is no rating because fake reviews have been detected. This is an absolute red flag. Fake reviews are a rating scam.

According to expert assessments, Binance has an impressive financial cushion and is highly profitable. Therefore, there seems to be no risk of insolvency for customers. However, there is a risk that individual jurisdictions such as the U.S. may prohibit Binance, possibly freeze funds and take action against Binance customers.

Risk & Compliance Assessment

Due to Binance’s numerous violations of regulatory requirements, the support for cybercrime and terrorist activities, and the ongoing facilitation of illegal online casino and gambling activities, we have placed Binance on the Red Compliance list. As a result of the pending fake review investigations of Trustpilot, we have downgraded the risk rating from Orange to Red.