The United States Financial Crimes Enforcement Network (FinCEN) — a bureau of the Treasury Department — has argued that Binance is linked to the unlawful cryptocurrency platform Bitzlato.
In an order revealed on Jan. 18, FinCEN said that the Binance cryptocurrency alternate was among the many “top three receiving counterparties” of Bitzlato by way of Bitcoin (BTC) transactions.
According to the authority, Binance was among the many largest counterparties that acquired Bitcoin from Bitzlato between May 2018 and September 2022. Other counterparties included Russia-connected darknet market Hydra and the alleged Russia-based Ponzi scheme often called “Finiko,” FinCEN famous.
On the opposite hand, FinCEN didn’t point out Binance as the highest three sending counterparties within the order. According to the doc, the largest Bitcoin senders to Bitzlato between May 2018 and September 2022 had been Hydra, Finland-based alternate NativeBitcoins and Finiko.
“Approximately two-thirds of Bitzlato’s top receiving and sending counterparties are associated with darknet markets or scams,” FinCEN wrote within the order. The company famous that between 2019 and 2021, Bitzlato acquired crypto price $206 million from darknet markets, $224 million from scams, and $9 million from ransomware attackers.
The information comes amid a number of U.S. authorities initiating main enforcement motion in opposition to Bitzlato, accusing the agency of cash laundering and allegedly facilitating circumvention of sanctions in opposition to Russia. As a part of the case in opposition to Bitzlato, the Federal Bureau of Investigation arrested Bitzlato founder Anatoly Legkodymov on Jan. 17 in Miami.
Unlike main crypto exchanges like Binance or Coinbase, Bitzlato was a little-known cryptocurrency service. Founded in 2016, the platform reportedly has an workplace within the Federation Tower skyscraper in Moscow, the place it accepted transactions of $100,000 or extra.
The alleged involvement of Binance in Bitzlato’s case raises some issues in regards to the alternate’s operations and potential ties with Russia. As beforehand reported, Binance was amongst exchanges that opted to proceed to serve non-sanctioned Russians after the European Union adopted the eighth sanctions package deal in opposition to the nation.
Related: Binance registers as digital asset service supplier in Poland
Addressing Cointelegraph’s request for remark relating to FinCEN’s reference to Binance in Bitzlato’s case, a spokesperson for Binance stated that the agency has been collaborating with regulators, stating:
“Binance is happy to have supplied substantial help to worldwide regulation enforcement companions in help of this investigation. This exemplifies Binance’s dedication to working collaboratively with regulation enforcement companions worldwide.“
FinCEN didn’t instantly reply to Cointelegraph’s request for remark.