Binance moves nearly $4 billion amidst US DoJ demand to end years long investigation


Share:
  • Binance has recently moved $3.9 billion USDT to its hot wallet, marking the eighth largest Tether transaction on Tron. 
  • The US DoJ is seeking over $4 billion from Binance to end its investigation, according to a Bloomberg report.
  • The SEC filed a lawsuit against Kraken on Monday, signaling that the US regulator continues its crackdown on crypto exchanges.

Binance is currently facing one of the largest investigations that the US Department of Justice has ever conducted into a cryptocurrency firm, according to a Bloomberg report. While negotiations between the two parties continue, a Bloomberg report claims that the US Department of Justice (DoJ) seeks more than $4 billion from the exchange to end its years-long investigation.

The US DoJ is probing Binance’s alleged involvement in money laundering, bank fraud, and sanctions violations among other charges.

In this context, twelve days ago Binance moved $3.9 billion USDT on Tron, from its cold wallet to a hot wallet, raising alarm among crypto market participants. This transaction is the eighth largest one to occur on the Tron blockchain. It is likely that the fund transfer is a coincidence, but the transaction has sparked speculation among market participants as it is similar to the US Justice Department’s alleged demand to settle the case.

Also read: XRP price could rally 10% higher with institutional interest in Ripple funds

US DoJ seeks more than $4 billion from Binance: Bloomberg

According to a November 20 Bloomberg report, Binance faces a $4 billion demand from the US DoJ. The Justice Department is seeking these funds to end its investigation into the exchange platform. The report states that a resolution is expected as early as the end of the month, and failure to settle could result in Binance founder and CEO Changpeng Zhao (CZ) facing criminal charges in the US.

In March, the Commodity Futures Trading Commission (CFTC) alleged that Binance and CZ routinely violated US derivatives rules. In June, the Securities and Exchange Commission (SEC) had filed a lawsuit accusing Binance and Changpeng Zhao for mishandling customer funds, misleading investors and regulators and violating securities laws.

The Justice department’s investigation is led by money laundering and asset recovery, national security divisions and the Seattle US Attorney’s office. If Binance settles with the Justice Department, paying more than $4 billion in fines, it would mark one of the largest penalties in a criminal crypto case.

A settlement would allow Binance to continue operations, rather than trigger a collapse that would have a ripple effect on the crypto ecosystem and its users. Binance has the option of a deferred-prosecution-agreement, which would open the exchange to criminal charges and the exchange would pay a substantial penalty and produce a statement outlining its wrong actions.

Binance has also been under scrutiny for evasion of US sanctions against Iran and Russia, and financing Hamas, according to Bloomberg. 

Binance moves $3.9 billion USDT to hot wallet

Binance recently (12 days ago) moved $3.9 billion USDT on Tron from its cold wallet to hot wallet. The transfer was recorded on the blockchain. Binance didn't immediately respond to FXStreet's request for comment about the transaction. Some market participants are speculating that the move could be related to the DoJ’s alleged demand of over $4 billion to settle the case.

Binance transfers $3.9 billion USDT

Binance transfers $3.9 billion USDT among its wallets

If the transfer is related to DoJ’s demand, it means that the exchange is preparing to settle with the Justice Department, likely shielding the crypto ecosystem from the fallout of Binance. 

Meanwhile, US regulators’ crackdown on crypto exchanges continues. The SEC sued Kraken on Monday, accusing the exchange of running an unregistered national securities exchange. Co-founder Jesse Powell condemned the SEC’s move and said that the exchange had previously settled charges for $30 million in February.

The SEC was also heavily critiqued by Ripple and Coinbase legal officers, which have also been in the regulators’ spotlight.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content


Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended Content

Editors’ Picks

Blur price likely to extend losses to 42% as whale investors dump BLUR tokens

Blur price likely to extend losses to 42% as whale investors dump BLUR tokens

Blur price rallied 352% in just 43 days between October 12 and November 24, which propelled it to create a local top at $0.685. While this move is impressive, BLUR has already shed 26% and trades at $0.502. A minor pullback is likely before the altcoin drops even lower. 

More Blur News

Charles Hoskinson says, “There was no Cardano ICO”; argues Bitcoin is not decentralized

Charles Hoskinson says, “There was no Cardano ICO”; argues Bitcoin is not decentralized

Cardano is known as the third-generation cryptocurrency and, at times, even the "Ethereum killer" but never as “not a security”. For that matter, the Securities and Exchange Commission, to date, has only named Bitcoin as "not a security," and XRP partially won that label following its lawsuit win.

More Cryptocurrencies News

Terra Classic price recovery rally hiccups as LUNC meets key barrier amid USTC related hype

Terra Classic price recovery rally hiccups as LUNC meets key barrier amid USTC related hype

Terra Classic is on a recovery rally, ploughing back to recover the ground lost after a steep fall as the price action consolidated within a descending parallel channel. The $0.00005234 support floor came into play, providing the launchpad for a recovery.

More Terra Classic News

YGG price remains stable despite $6.05 million worth of tokens entering the market

YGG price remains stable despite $6.05 million worth of tokens entering the market

YGG price was expected to take a hit on November 27 in lieu of the token unlock event that took place during the day. Interestingly, this was not the case as the altcoin managed to not only deflect damage but also retain investors’ profits.

More YGG News

Three key BTC accumulation levels before ETF approval in January 2024

Three key BTC accumulation levels before ETF approval in January 2024

Bitcoin, from a high time-frame perspective, has been in an up-only trend since the start of 2023. BTC has ignored many sell signals due to the likelihood of an Exchange-Traded Fund approval. With the holidays around the corner, falling liquidity could see BTC discounted from its current level, hovering around the $37,000 region.

Read full analysis

BTC

ETH

XRP