Binance received negative feedback on its license application in Germany on Wednesday. German government agency BaFin rejected the exchange’s application for a license. News sources familiar with the matter attribute the failure to CEO CZ.
Media attributes Binance failure to CZ
The news in media giants such as The Wall Street Journal (WSJ) recently attributes the German regulator BaFin’s rejection of Binance’s license application to CEO CZ. According to the sources, the complex nature of the stock market also played a leading role in the regulatory agency’s decision against it.
cryptocoin.com As we have reported, Binance announced on July 26 that it has withdrawn its license application in Germany. BaFin, the institution behind the decision, expressed its reservations about the exchange’s supervision. The regulator informed Binance that Zhao, also known as “CZ,” may not have passed an “appropriate and adequate” test under the financial watchdog’s regulatory guidelines…
According to The Wall Street Journal’s July 28 report, BaFin argues that CZ does not have a ‘proper’ track record. The regulator is following various guidelines for applying for a license. These; managers “have the necessary professional qualifications and have a good reputation to run an organization and devote sufficient time to the discharge of their duties.” In this case, the German regulator lists a few items missing, with reference to the CZ.
‘Binance’s complexity is in big trouble’
BaFin also informed Binance that the company’s structure thwarted regulatory oversight. Prior to that, Binance announced on July 26 that it was withdrawing its application in Germany. At the time, he said the decision was partly based on the company’s focus on efforts to comply with the European Union’s MiCA framework.
On the other hand, Binance denies some accusations against it. A stock market spokesperson said The Wall Street Journal report was untrue. The exchange did not provide a specific response on details regarding CZ at the time of publication.
While no criminal charges were filed at the time of publication, reports indicate that the US Department of Justice (DoJ) is investigating Binance for violating US sanctions against Russian entities. Binance chief strategy officer Patrick Hillmann announced that he will be leaving the firm on July 6 in response to the DoJ investigation.
Despite being the world’s largest crypto exchange, Binance does not actually have an operating headquarters. Reports suggest that CZ has had a home in Dubai since 2021. However, the SEC had difficulty issuing a legal subpoena to the CEO in June.
Leading stock market counter-moves in CFTC case
Binance recently denied the CFTC charges starting in March. The US regulator specifically accuses the exchange of ‘excessive’ sanctions beyond its jurisdiction. Exchange lawyers also emphasize that CZ and Binance are located outside of the US.
