Binance Fights Back Against CFTC, Says It’s Not ‘World’s Derivatives Police’
Cryptocurrency exchange Binance renewed arguments against Commodity Futures Trading Commission (CFTC) charges on Monday, claiming the regulator is overstepping its authority.
Binance faces increasing regulatory pressure as the CFTC pursues charges over allegedly offering unregistered crypto derivatives to US customers. In a March complaint, the CFTC claimed jurisdiction because the derivatives were denominated in a commodity.
Binance fired back in a Monday court filing, stating:
- The CFTC is incorrectly arguing it can regulate any crypto activity globally relating to a derivative product.
- US law does not empower the CFTC to police worldwide derivatives markets.
Binance alleges the CFTC relies on “broad arguments” in the case. A September CFTC filing accused the exchange of “deliberately targeting” US customers and fostering a “wink-and-nod” ethos of compliance.
The exchange’s filing on Monday reads, “The CFTC relies on new and broad arguments that would allow it to regulate any activity in cryptocurrency (or other assets) related to a derivatives product anywhere on the globe.”
Binance stresses that its US operations are separate
However, Binance maintains that its US operations are strictly separated under Binance.US. Additionally, the exchange argues that only its domestic arm can be held accountable by US regulators.
The CFTC case comes as the exchange battles other regulators like the Securities and Exchange Commission. In addition, as global scrutiny mounts, the crypto giant is pushing back on what it sees as overbroad attempts to enforce US rules internationally.
For now, the exchange is resisting the CFTC’s claim to global reach in the derivatives case. However, the exchange stresses that it is not seeking to avoid appropriate regulation.
