Binance US is currently facing a probe by the SEC (Securities and Exchange Commission) over connections with Sigma Chain AG and Merik Peak Ltd.
These companies trade cryptocurrencies on Binance under the guise of market makers who would usually buy and sell cryptocurrencies to help balance the market prices.
Binance controversial founder Changpeng Zhao is believed to be the owner and is the centerpiece between these two companies.
The main suspicion in this probe is whether the companies are getting preferential treatment directly from Binance. The SEC has requested information from Binance US in whether they have disclosed this information to US clients.
The SEC has been turning up the heat on crypto companies lately as they have noticed the influence this industry has gained over the last few years. Recently they have clamped down on BlockFi and their lending platform.
Given the vast scale of the crypto market both in wealth and geography, it’s not going to be an easy task clamping down on these platforms.
Binance has also been in the spotlight over the years on suspicions over its trading practices. Recently they invested $200 million in Forbes which is a print and digital publisher.
This is an interesting deal that could be looked at through many lenses, from a PR perspective it’s a good move as Forbes is an established company that has been around for over 100 years.
Despite the move, it’s still not enough to clean up the suspicions surrounding the company and probably won’t be enough to circumvent any bad publicity that might come in the future.
