On October 5, popular exchange Binance announced that Binance Chain and Binance Coin (BNB) will soon become traceable through CipherTrace. The decision to improve its compliance with AML practices comes amidst regulators clamping down on privacy coins and exchanges such as OKEx delisting them.
CipherTrace will start offering institutional-grade Anti Money Laundering surveillance services for Binance. This allows users to verify high-risk addresses and data when dealing with Binance Chain or BNB.
Binance emphasized that privacy concerns have been heard and that data will not be shared with third parties. Binance COO Samuel noted:
“Users can rest assured that Binance will uphold its usual high standards of user security and data protection.”
At the moment, it is not clear whether Binance’s move in the direction of more AML and regulatory compliance will affect currently listed privacy coins on the exchange.
Although better compliance with AML practices is generally perceived as a good thing for the community and Binance itself, the cooperation with CipherTrace drew a lot of criticism from the community. Critics mainly pointed out that tracking companies like CipherTrace or Chainalysis could be hacked or compelled by authorities to give out data without user permission.
What do you think? Is Binance taking steps in the right direction with its cooperation with CipherTrace?