[cemerick]

Come on. Further down in the op-ed you linked, he cites evidence in the complaint about Binance being used to launder funds for Hamas and Russia. The feds happened to get Capone on mail fraud; if they see that they can pinch off such laundering with the help of some ostensibly consumer-focused CFTC authorities, that's what's going to happen.

[darawk]

You mean the $600 ex-post identified Hamas transaction? That one? He cites it grudgingly, because it's total bullshit. He very clearly articulates what he thinks the substance of the complaint is, and it is not terrorist financing.

Here is the actual lead in to him quoting that part:

> Anyway I said that there are only a few accusations of financing crimes or secretly trading against customers in the CFTC complaint, but there are not none, and I should quote them. Here’s this:

Judge for yourself if I am misrepresenting his view.

[mattmaroon]

It does not say that there was only one $600 transaction, only that a $600 transaction can barely buy a particular weapon. It says that they're structuring the payments to be small to avoid money laundering notice.

'Lim explained to a colleague that terrorists usually send “small sums” as “large sums constitute money laundering.” Lim’s colleague replied: “can barely buy an AK47 with 600 bucks.” And with regard to certain Binance customers, including customers from Russia, Lim acknowledged in a February 2020 chat: “Like come on. They are here for crime.'

We have no idea from this what sort of money laundering Hamas was doing on Binance, or if it was found ex-post, but we do know that at least one Binance employee thought they were using it for crime.

[darawk]

We do not know that. All we know is that a Binance employee knew about a $600 transaction, and made a general statement about the behavior of groups like this. We know nothing beyond that.

[JumpCrisscross]

> a Binance employee knew about a $600 transaction

Said employee being the then chief compliance officer.

Your broad point is correct: Binance is not being dinged by the CFTC for money laundering or terrorist financing. But the allegations they hung out are far from trivial. (The core charge is also nontrivial, but for technical reasons.)

[darawk]

If the core charge is that Binance allowed some of the most sophisticated firms in the world to trade on it derivatives exchange without oversight from US regulators, we're just going to have to agree to disagree about that being trivial.

[mattmaroon]

It does not say that there actually was a $600 Hamas transaction at all, you just invented that in your head. It just said that one couldn’t purchase an AK with one. It was a hypothetical example of a small sum because he was saying that’s how terrorists do it to avoid notice.

[bolanyo]

Isn't it more the other way around here?

The CFTC want to prosecute Binance for violating restrictions on allowing US persons to buy and sell derivatives, but they are aware that this is somewhat weak sauce, because the people buying and selling are all sophisticated institutional players, and Binance themselves are only very dubiously subject to US jurisdiction.

So they make it into a case about 'funding terrorism' based on a casual remark from a chat log.

[mattmaroon]

Tax evasion, not mail fraud.