Binance’s regulatory woes are partially down to its rapid growth and lack of efficient global regulation of the cryptocurrency sector, the digital asset exchange’s chief executive has said.
The cryptocurrency exchange plans to double the size of its international compliance team by the end of this year, boss Changpeng ‘CZ’ Zhao said in a 6 July blog post, having already added several former US financial officials to its advisory board.
“Binance has grown very quickly and we haven’t always got everything exactly right, but we are learning and improving every day,” Zhao said.
“We hope to clarify and reiterate our commitment to partner with regulators, and that we are pro-actively hiring more talent, putting in place more systems and processes to protect our users.”
Binance has been at the centre of a global effort to crack down on cryptocurrency companies that have shown higher levels of fraudulent activity, according to regulators.
Watchdogs in the UK, Cayman Islands, Japan and Thailand have issued warnings against Binance in recent weeks, causing the firm to temporarily suspend transactions in sterling and euros at times.
Addressed as an open letter, Zhao said that clarifying a set of standards in the regulation of companies such as Binance “is critical for the industry’s continued growth”, with the sector at a “tipping point”.
“This lofty vision won’t be possible without the support and guidance of regulators and policymakers,” he said. “We humbly welcome more constructive guidance to help us to grow better.”
Banks across the UK have also struggled with how to protect customers from crypto-exposed fraud, with Barclays going as far as to block fund transfers to Binance.
Nationwide became the latest lender to put its cryptocurrency policy under review this week, Financial News revealed, alongside Santander and NatWest.
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