Binance Claims Again: Central Banks of Lithuania and Hong Kong Warn, DOJ Says “No Thanks”

The Bank of Lithuania has warned Binance of their unauthorized investment services offered in the country. The bank requires the company to ensure that its public information is not misleading. In the meantime, Hong Kong is more concerned about Binance’s security token offerings.

Warning from the Lithuanian bank

Bank of Lithuania Note that services related to crypto assets are not regulated or monitored. After evaluating the public information, Binance is the virtual currency exchange operator and the virtual currency wallet operator.

However, the bank warned the company that some of its investment services are unlicensed. For example, Binance enables customers to invest in financial derivatives related to crypto assets. Under Lithuanian law, these vehicles are considered financial instruments and must be licensed. Authorities said they would monitor all unlicensed activity in the country and stop providing these services if discovered.

The problem in Hong Kong with security tokens

Meanwhile, Hong Kong’s Securities and Futures Commission (SFC) said it was concerned that the security tokens being offered by Binance will be available to its investors. The SFC affirms that no legal entity on the Binance team is licensed or registered to perform “managed operations” in Hong Kong.

According to the authorities, security tokens can be regarded as “security” within the meaning of the Securities and Futures Regulation (SFO). In this case they are subject to the SFC regulations. The SFC also warns that security tokens that are considered “security” also require the appropriate license.

However, SFC does not have to worry about security token issues for the time being as Binance has announced it will stop selling security tokens. The exchange said it will continue to offer the service through October, at which point the positions of all customers who continue to hold security tokens will be closed.

DOJ says “no thanks” to Binance

Binance appears to have fallen out of favor with US government agencies. Exchanges often require signed letters of thanks for working together on criminal investigations. Currently the Ministry of Justice (DOJ) command to the highest law enforcement agencies to put an end to this action.

Binance used these FBI and IRS thank you letters to publicly confirm that it was a law abiding company. But by law, Binance is required to assist these institutions in their exploration. From the DOJ’s point of view, Binance’s helpfulness has nothing to do with this fact, so a thank-you letter is unnecessary.

“As part of our ongoing efforts to improve the industry, cooperate with regulators and law enforcement agencies to fight cybercrime. The letters we received to confirm our support speak for themselves, “said a Binance spokesman.

In any case, law enforcement agencies have forwarded these thank you letters to Binance earlier. The exchange gave several examples of these letters from officials in the past. But some of them have very similar formulations.

Robert Gonzalez, a California police detective, said Binance sent samples for these letters but made some changes before signing them. In addition, Gonzales told Bloomberg that Binance has always worked with him in various forms.

The letters are unlikely to help Binance get out of trouble. According to multiple sources, the DOJ and the IRS are investigating Binance on suspicions of money laundering and tax violations and have been questioning Binance employees since last May. Binance does not have an office in the US and has set up a separate company called Binance.us for its US customers.

Annie

Bitcoin magazine

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