Reuters Blasts Binance for $2.35B Money Laundering Problem

0
17
Reuters Blasts Binance for $2.35B Money Laundering Problem

Key Takeaways

  • A new report from Reuters claims Binance allowed more than $2.35 billion worth of criminal funds to process through its exchange unchecked.
  • Entities believed to have laundered money through Binance include a North-Korean hacking syndicate and the former largest darknet drug marketplace in the world.
  • Binance is said to have been an easy exchange to launder money through due to its previously lax KYC requirements.

A report from Reuters claims that Binance may have allowed the laundering of more than $2.35 billion over a period of five years. The report highlighted instances when North Korean hackers, Russian drug dealers, and European organized crime groups allegedly processed money through the exchange.

State Hackers, Drug Dealers, and Organized Crime

Binance, one of the largest cryptocurrency exchanges in the world, may have let billions of dollars worth of hacked funds transact through its platform, a new investigative report from Reuters has found.

According to the report, Binance allegedly processed more than $2.35 billion of stolen funds between 2017 and 2021. The funds (the total of which was calculated from court records, law enforcement statements, and with the help of blockchain analysis firms) are said to have originated from on-chain hacks, investment frauds, and illegal drug sales. Blockchain research firm Chainalysis has stated that Binance processed $770 million of criminal funds in 2019 alone.

The Reuters report singles out entities having allegedly laundered money through Binance, including the Lazarus Group, the North Korean cybercrime syndicate responsible for hacking $550 million from the Ronin bridge last year. While Binance worked with law enforcement to identify and freeze $5 million from the hack, the amount that did succeed in passing through the exchange is unclear.

Hydra, a giant Russian-language darknet marketplace that used cryptocurrencies for the sale and purchase of drugs, is also said to have used Binance to process more than $780 million since early 2018. 

The report finally details that European organized crime groups targeted pensioners in Germany, Austria, and Spain, and may have laundered more than $800 million of fake trading website gains through cryptocurrency exchanges, particularly Binance.

Binance was the cryptocurrency exchange of choice, the report says, because of its previously loose know-your-customer (KYC) identity verification checks. Indeed, traffic between Binance and Hydra dropped sharply after the KYC requirements were tightened in August 2021.

When asked to comment on the Reuters investigation, a Binance spokesperson told Crypto Briefing that “the article uses outdated information from 2019 and unverified personal attestations as a crutch to establish a false narrative” before highlighting Binance’s cooperation with law enforcement in multiple cybercrime investigations.

Disclosure: At the time of writing, the author of this piece owned ETH and several other cryptocurrencies.

The information on or accessed through this website is obtained from independent sources we believe to be accurate and reliable, but Decentral Media, Inc. makes no representation or warranty as to the timeliness, completeness, or accuracy of any information on or accessed through this website. Decentral Media, Inc. is not an investment advisor. We do not give personalized investment advice or other financial advice. The information on this website is subject to change without notice. Some or all of the information on this website may become outdated, or it may be or become incomplete or inaccurate. We may, but are not obligated to, update any outdated, incomplete, or inaccurate information.

You should never make an investment decision on an ICO, IEO, or other investment based on the information on this website, and you should never interpret or otherwise rely on any of the information on this website as investment advice. We strongly recommend that you consult a licensed investment advisor or other qualified financial professional if you are seeking investment advice on an ICO, IEO, or other investment. We do not accept compensation in any form for analyzing or reporting on any ICO, IEO, cryptocurrency, currency, tokenized sales, securities, or commodities.

See full terms and conditions.

North Korean Cybercrime Syndicate Lazarus Group Implicated in Ronin Ha…

News

The North Korean cybercrime group known as Lazarus Group has been confirmed by the U.S. Treasury Department to be linked to the $550 million Ronin Chain hack last month. The…

North Korean Cybercrime Syndicate Lazarus Group Implicated in Ronin Ha...

Binance Cuts Daily Withdrawal Limits for Unverified Users

Binance said users who have not been fully verified can withdraw up to 0.06 BTC daily. The previous limit was set to 2 BTC. Binance Reduces Money Laundering Risks Binance,…

Binance Cuts Daily Withdrawal Limits for Unverified Users

Binance’s CEO Has Responded to Chainalysis’ Laundering Cla…

Changpeng Zhao, the CEO of Binance, has taken to Twitter to contest recent reports from the blockchain analytics firm Chainalysis. In the Jan. 15 report, the firm claimed that Binance…

Binance’s CEO Has Responded to Chainalysis’ Laundering Cla...

Read More

LEAVE A REPLY

Please enter your comment!
Please enter your name here