CZ Responds to Reuters FUD About Binance Regulatory Compliance

Changpeng Zhao (CZ) – CEO of Binance – called out a Reuters journalist on Monday over a handful of “accusations” they’ve made against the exchange over the past several months. 

The executive said the reporter has written several articles about Binance based on anonymous sources, and that they recently crossed into “indefensible territory” with their line of questioning. 

Binance and Binance U.S.

The most recent article that Binance took issue with, titled “How Binance CEO and aides plotted to dodge regulators in U.S. and UK,” dropped on Monday. 

The piece alleged that Binance has attempted to “insulate” itself from regulators like the Securities and Exchange Commission while claiming its CEO is both “committed to secrecy” and “attentive to minute operational details.”

In his response, Zhao denied such implications that he is an “overbearing” or “secretive” leader, referencing a public document about some of the principles he follows. 

He also addressed claims about the “Tai-Chi Powerpoint” – a plan on how to set up Binance as an entity in the U.S. 

According to Reuters, the proposal – put forth by an entrepreneur named Harry Zhou – recommended that Binance set up a separate U.S. entity that complied with the Bank Secrecy Act. While the entity would have fewer features and liquidity than Binance’s main exchange on its surface, U.S. customers could exploit a “loophole” to access the latter using virtual private networks (VPNs). 

Yet according to CZ, Binance never actually followed through with the plan. 

“I personally rejected it,” he clarified. “The entire PowerPoint is only seven slides long, lacks any actionable direction, and looks like a 5th grader put it together.”

The CEO added that Binance U.S. was set up on the advice of U.S. law firms, and is still a separate entity from Binance.com – contrary to the article’s claims. 

Crossing the Line

CZ said that while Binance normally answers journalist inquiries, it chose not to respond to requests for comment for the recent Reuters piece. According to him, the reporter signaled an intent to discuss his children.

“Because we could not get assurances that this Reuters reporter would refrain from writing about my family, we have once again taken the unusual step of not responding to them directly,” he explained. “Instead, we are taking the story directly to the community.”

CZ published a similar blog post in September, countering media claims that Binance is a Chinese company. 

Earlier this month, Binance secured licensing to offer crypto services in Kazakhstan.