Coinan co-founder Changpeng Zhao (pictured).
The U.S. Department of Justice and the IRS are investigating cryptocurrency exchange Binance to stamp out the platform’s illegal activities, sources close to the investigation said.
Bloomberg reports that officials investigating money laundering and tax evasion have interviewed people with knowledge of Binance’s business as part of the probe. The sources said the Justice Department is joined in the investigation by the Bank Integrity Division and the Seattle Attorney General’s Office, while the IRS began jumping in months ago to assess the behavior of Cryptocurrency’s customers and employees.
Although the U.S. Department of Justice and the IRS are investigating potential criminal conduct, they may not have decided on the specific information to be examined, and not all investigations will eventually lead to allegations of wrongdoing.
Chainalysis, a blockchain evaluation firm, determined last year that more money related to criminal activity was circulating through Coinan than any other cryptocurrency exchange among the transactions the company examined. A CoinSec spokesman said it takes its legal obligations very seriously and will cooperate with regulators and law enforcement in their investigations. Spokespeople for the U.S. Department of Justice and the IRS declined to comment.
Founded in 2017, Cryptocurrency has been a standout, with co-founder Changpeng Zhao, a charismatic tech executive who often tweets and promotes digital currencies in media interviews. Like cryptocurrencies, Cryptocurrency is largely unregulated by the government, registered in the Cayman Islands and with an office in Singapore, but said it has yet to set up a corporate headquarters.