The Financial Transactions and Reports Analysis Centre of Canada (FINTRAC) imposed a $4.4 million fine on Binance, the world's largest cryptocurrency exchange, accusing it of violating anti-money laundering regulations. The regulator claims that Binance refused to register as a foreign money services business. The Wall Street Journal reported that Binance's surveillance team discovered market maker DWF Labs engaged in market manipulation.
FINTRAC announced sanctions on Binance and all its subsidiaries based on two violations found in compliance activities in 2023, fining Binance 6 million Canadian dollars (approximately $4.4 million).
The financial regulator stated that Binance refused to register as a Foreign Money Services Business (FMSB). According to the announcement, FINTRAC also gave Binance multiple opportunities to register as an FMSB, but Binance did not comply.
The second violation involved Binance failing to "report significant virtual currency transactions of $10,000 or more in a single transaction and the required information."
The Wall Street Journal cited sources indicating that Binance's surveillance team discovered DWF Labs suspected of market manipulation. Binance conducted an investigation after its internal monitoring team found DWF Labs involved in market manipulation, and dismissed the surveillance chief.
Former Binance members indicated that the dismissal of the compliance officer suggests the exchange ignored evidence of market manipulation.
DWF Labs has secured its position in Binance's highest "VIP 9" tier due to its massive trading volume, which means its monthly trading volume reaches at least $4 billion.
On the Binance exchange, higher trading volumes can increase a customer's VIP level, granting them lower trading fees and personal relationship management services.
The article also revealed that in 2023, top traders (with monthly trading volumes exceeding $100 million) accounted for two-thirds of the platform's total trading volume.
DWF Labs officially responded to the market manipulation allegations, claiming that many of the accusations reported in the media are baseless and distort the facts.
The market maker stated that the company always operates with the highest standards of integrity, transparency, and ethics, committing to continue supporting over 700 partners in the crypto ecosystem.
After the news was announced, the price of Ancoin (BNB) fell from $603 to $592 within three hours before retracing to $594.