Major crypto exchange Binance and its executives might’ve shot themselves in the foot, learning the news media lesson the hard way at a bad time.
Yesterday, Forbes reported that Binance “conceived of an elaborate corporate structure designed to intentionally deceive regulators and surreptitiously profit from crypto investors in the United States.” The report was based on “a document thought to be created by its senior executives.” However, despite “multiple attempts” by Forbes the company and its executives did not respond to their request for comment before the article was published.
Per the article: “Forbes reached out to Binance founder CZ as well as its chief compliance officer Samuel Lim about the leaked document and didn’t receive a response to our questions. Binance.US CEO Catherine Coley and Harry Zhou, the person identified as creating the document, also didn’t comment.”
Only after the article hit the internet and was widely shared in the cryptoverse, and, possibly, among regulators in the US, Binance CEO Changpeng “CZ” Zhao and Coley rushed to deny claims of potential ‘regulation evasion’ laid out against them, explaining themselves in a Twitter thread and a Youtube video.
The Forbes article was also updated after executives have finally responded. However, the damage was already done and instead of setting the news agenda, CZ and Coley were forced to explain themselves after the agenda was already set.
According to Forbes, Binance planned to set up an entity in the US “to distract regulators with feigned interest in compliance.” This, said the author, is according to a 2018 document thought to be made by senior Binance executives. Binance.US is also brought under suspicion by the author, as the article stated that “Binance appears to have gone out of its way to submit to US regulations by establishing a compliant subsidiary, Binance.US, an ulterior motive is now apparent.”
CZ replied that the claims are incorrect, that the exchange has always followed laws and regulations in each jurisdiction, and that the document on which the entire article is based was not created by a Binance employee (the last of which the author claims had been confirmed to Forbes in an email).
