The Curious Case of Gensler and Binance
In a peculiar twist of fate, Binance, the crypto exchange that’s always on everyone’s lips (and wallets), sought to snag Gary Gensler as an advisor before he took the reins as chairman of the U.S. Securities and Exchange Commission (SEC). Reports revealed that between 2018 and 2020, Binance’s executives traded messages and held face-to-face meetings with Gensler, who was teaching at MIT at the time. Who knew MIT professors could brew up such excitement in the crypto world!
When Crypto and Academia Collided
The initial meeting took place in 2018 when Ella Zhang, head of Binance’s venture investing arm, and Harry Zhou, co-founder of Koi Trading, met with Gensler. After he passed on the advisor role, Zhou remarked, “I observe that while Gensler declined adviseship, he was generous in sharing license strategies.” One can only imagine the mix of excitement and slight disappointment in the room. Perhaps Gensler left them with a riddle – a good old ‘I’ll scratch your back if you scratch mine’ scenario, but in regulatory terms.
Regulatory Foresight or Just Guts?
The dating saga continued with a second rendezvous in March 2019 in Tokyo, where Binance founder Changpeng “CZ” Zhao met Gensler. A Binance employee reportedly suggested that Gensler was likely to return to a regulatory position if the Democrats triumphed in the 2020 election. And lo and behold, Gensler assumed the SEC chair position in April 2021. Coincidence? Or perhaps Gensler was doing a bit of market research on the future of digital assets?
Binance’s Strategic Moves in the Shadows
With regulatory clouds looming, Binance executives prepped for potential storms. They proposed a plan titled “Insulate Binance from US Enforcement,” promoting a contractual relationship with their American counterpart, Binance.US. This strategy seemed akin to an effective last-minute study session before finals – smart, but also a bit desperate. They wanted to ensure Binance would remain untouched by the regulatory scrutiny that often leads to hefty fines and penalties.
The Compliance Journey
A spokesperson for Binance clarified that when Binance.US was established, there was an agreement with the Binance.com tech team to support the new U.S. exchange. If you’re thinking “two heads are better than one,” Binance aimed for the ultimate separation of church and state… theoretically speaking. They emphasized they do not have U.S. customers, portraying themselves as separate legal entities, even declaring that they learned from past “missteps” while growing. Times are changing, and so is their compliance team – boasting a 500% increase in body count over the last year.
The Road Ahead
As Binance prepares to confront regulatory bodies and hopes to settle any outstanding grievances, they seem to be turning a new leaf. Chief strategy officer Patrick Hillmann noted they’ve embraced a cooperative spirit with regulators to mend their compliance image. Whether this will thaw the icy regulatory relations remains to be seen, but one thing’s for sure; the crypto landscape is as entertaining as ever!
Update: March 5, 9:22 p.m. UTC
This article has been updated to reflect Binance’s latest comments, proving once again that in the fast-paced world of crypto, things can change in a heartbeat!
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