Former insiders reveal how Binance prioritized profits over user protection
- Binance promised to deliver a safe and trusted platform but neglected evidence of market manipulation
- Internal investigation found a top client manipulating markets, but Binance kept the client and fired the investigator
- Former company insiders reveal that Binance’s surveillance team found VIP clients engaged in prohibited trading practices
- Binance maintained secret internal trading accounts for large volumes of certain crypto tokens
- Binance faces civil charges in a SEC lawsuit and its founder was sentenced to jail
- Binance’s market-surveillance team grew to track market manipulation and detect wash trading
- Investigators recommended removing several hundred users for violating terms of use
- Binance off-boarded the Tron Foundation and observed its own internal accounts trading certain cryptocurrencies
- DWF Labs, a top client of Binance, manipulated token prices and engaged in wash trades
- Binance fired its market-surveillance team head after rejecting their recommendation to remove DWF Labs
Binance, the world’s largest digital-currency exchange, promised to deliver a safe and trusted platform but neglected evidence of market manipulation when an internal investigation found a top client manipulating markets. Instead of taking action, Binance kept the client and fired the investigator. Former company insiders reveal that Binance’s surveillance team discovered that VIP clients engaged in prohibited trading practices, including pump-and-dump schemes and wash trading. Binance also maintained secret internal trading accounts for large volumes of certain crypto tokens. The exchange faces civil charges in a SEC lawsuit and its founder was sentenced to jail. Binance’s market-surveillance team grew to track market manipulation and detect wash trading, recommending the removal of several hundred users for violating terms of use. The team off-boarded the Tron Foundation and observed Binance’s own internal accounts trading certain cryptocurrencies. DWF Labs, a top client of Binance, manipulated token prices and engaged in wash trades. Despite the evidence, Binance rejected the recommendation to remove DWF Labs and fired the head of its market-surveillance team.
Factuality Level: 2
Factuality Justification: The article contains a mix of relevant information about Binance’s internal investigation, market manipulation, and regulatory issues. However, it lacks depth and context in some areas, and it includes some sensationalized reporting and biased language.
Noise Level: 2
Noise Justification: The article provides a detailed and in-depth analysis of the market manipulation allegations against Binance, including information on the company’s internal investigation, actions taken, and responses from both Binance and the involved parties. It sheds light on the complexities of the cryptocurrency market and the challenges faced by regulators in monitoring and enforcing compliance. The article is well-supported with evidence from interviews, documents, and industry players, maintaining focus on the central topic without delving into unrelated territories. It also highlights the consequences of decisions made by Binance on market integrity and user protection, holding the company accountable for its actions.
Financial Relevance: Yes
Financial Markets Impacted: The article pertains to the cryptocurrency exchange Binance, which is a major player in the digital-currency economy. It discusses allegations of market manipulation and failure to prevent manipulative trading, which could impact the reputation and trustworthiness of Binance and potentially affect the cryptocurrency market as a whole.
Presence Of Extreme Event: No
Nature Of Extreme Event: No
Impact Rating Of The Extreme Event: No
Rating Justification: The article focuses on allegations of market manipulation and regulatory issues surrounding Binance, a major cryptocurrency exchange. While these allegations have financial implications and could impact the cryptocurrency market, there is no mention of an extreme event or any specific impact rating.
Public Companies: Binance (Not applicable), Bank of America (Not applicable)
Private Companies: DWF Labs,Tron Foundation,HTX,Yield Guild Games
Key People: Changpeng Zhao (Founder of Binance), Andrei Grachev (Russian managing partner of DWF Labs), Justin Sun (Crypto entrepreneur, friend of Binance founder Zhao), Gabby Dizon (Co-founder of Yield Guild Games)
Reported publicly:
www.wsj.com 
