Binance joins lobbying group as criticism of the exchange ramps up
The exchange has come under increasing pressure from critics after the collapse of its rival, FTX.
Binance has joined the Chamber of Digital Commerce, a United States crypto industry lobbying group, according to a Dec. 20 press release from the exchange. The move comes after Binance has been criticized for allegedly being unregulated.
Binance’s vice president of public affairs, Joanne Kubba, expressed hope that the partnership would help lead to clear regulations for the crypto industry in the U.S., stating:
“As an organization at the crux of the industry’s rapid growth and complex regulatory environment, working hand in glove with policymakers, regulatory bodies and industry groups like the Chamber is imperative for Binance. Such work is fundamental to our shared mission of fostering the sustainable development of sensible regulations for cryptocurrency and blockchain, which ultimately ensures protections for users.”
According to its website, the Chamber of Digital Commerce advocates for a variety of public policies, including tax parity for digital assets, Anti-Money Laundering/Know Your Customer regulations for crypto exchanges, increased regulatory clarity for security tokens and research on central bank digital currencies.
Through its political action committee, the Chamber made contributions to three congressional candidates in 2022: Republican Representative Patrick McHenry of North Carlina; Republican Senate candidate Blake Masters of Arizona; and Democratic Senator Ron Wyden of Oregon.
Related: New House Financial Services Committee chair wants to delay crypto tax changes
Controversy around Binance
Since the collapse of FTX, calls for crypto regulation have increased, and Binance has come under special scrutiny for being a high-volume exchange that has no clear geographical location or regulatory status.
In a congressional hearing on Dec. 14, Kevin O’Leary claimed that Binance caused the collapse of FTX and is an unregulated monopoly.
Binance’s CEO, Changpeng Zhao, responded to O’Leary’s claims in a Dec. 15 CNBC interview, calling them “a bunch of nonsense claims.”
On Dec. 12, Reuters released a report claiming that U.S. Justice Department officials were deciding whether to charge Binance executives with financial crimes. The executives have not been charged so far, but the report led to large outflows of stablecoin and other cryptos from Binance.
In order to prove that it is trustworthy and solvent, Binance has released an audited proof-of-reserve. However, the proof-of-reserve has been criticized for not disclosing Binance’s corporate structure or internal controls.
Binance.US, a separate exchange with the same namesake as the global trading platform, joined the Chamber of Digital Commerce in 2020. Its rival, FTX, was also a contributor to U.S. politicians. But this appears to be the first time the international Binance organization has directly joined a U.S. lobbying group.