Crypto Lobbying: Binance Joins the Race

Summary

Binance, facing significant outflows and regulatory scrutiny, has joined the Chamber of Digital Commerce for crypto lobbying to influence policy and regulation in the United States.

Abstract

In response to recent challenges, including substantial withdrawals exceeding $6 billion and the loss of its auditor, Mazars Group, Binance has decided to engage in crypto lobbying by becoming a member of the Chamber of Digital Commerce. This move follows the collapse of FTX and growing investor concerns over Binance's operational transparency, particularly regarding the location of its headquarters and the management of its financial books. The lobbying effort is aimed at shaping a favorable regulatory framework and mitigating potential legal actions, such as money laundering and fraud charges being considered by the U.S. Department of Justice. Binance's CEO, Changpeng Zhao, previously triggered the FTX collapse by liquidating FTT tokens, which has since led to increased volatility and a shift towards self-custody among crypto investors.

Opinions

The author implies that Binance's decision to join a lobbying group is a strategic move to protect its interests in the face of regulatory challenges and to potentially influence lawmakers.
There is a suggestion that Binance's lack of transparency, especially concerning its headquarters and financial records, is a cause for investor concern and skepticism.
The article conveys a critical view of Binance's past actions, such as the liquidation of FTT tokens, which may have contributed to the current climate of distrust and volatility in the crypto market.
The author seems to question the effectiveness of lobbying as a means for Binance to address its regulatory and public image issues, while also highlighting the company's proactive stance in engaging with policymakers.
There is an underlying concern that the crypto industry might be heading towards a period of increased regulatory scrutiny and a potential "ice age" if major platforms like Binance fail to maintain consumer trust and comply with legal frameworks.

Crypto Lobbying: Binance Joins the Race

Guess who is banking heavily on crypto lobbying? At this point, we all know Binance exchange is in trouble. While some call it a “stress test”, the massive amount of outflows is a serious deal. With over $6 billion in outflows in less than a week, BNB dumped a few days ago. This came after auditing company Mazars Group announced that they will not work for any crypto client due to the super-complex nature of their assets. Naturally, when the situation is less than ideal, the best resort is to join the most powerful crypto lobbying gang. Perhaps, this will ensure that the lawmakers will back off from looking into Binance and how they operate. After all, Binance has a lot to hide. unbelievably, the company will not disclose where their headquarters are! So when it comes to their books, nobody knows anything and it seems that they like to keep it that way. And what better way to prove investors that your company is not sketchy than joining a lobby. Yes, this is Binance’s next step, crypto lobbying in America.

The Outflows

Since The collapse of FTX, Binance exchange has seen a massive load of withdrawals. So far, the outflows are well above $6 billion while more than half of it was in stablecoins. Of course, Changpeng Zhao, the CEO of Binance triggered the FTX collapse by liquidating all FTT tokens. However, despite revealing FTX’s dirtiest secrets, investors are now concerned that Binance may as well be a big lie.

According to analytics firm Glassnode, stablecoins have had a combined outflow of $3.2 billion during a 30-day period. This includes Tether (USDT), USD Coin (USDC), Binance USD (BUSD) and Dai (DAI).

Source: Glassnode/Twitter

Other than stablecoins, Bitcoin and Ethereum have also been sliding out of the exchange as the fears of their insolvency grows stronger.

“We can see greater volatility in Binance exchange balances through December.

If we look to BTC inflow/outflows, we can see there have been significant withdrawals of late.

13-Dec recorded 57,300 BTC in outflows, and the largest net BTC outflow from Binance in history.”

On the same day, more than $544 million worth of Ethereum also moved out of the exchange. Obviously, self-custody is now on top of everyone’s list. While these record breaking withdrawals are causing a shift in consumer sentiment, they can also bring down giant platforms and push crypto further down into an inevitable ice age.

Crypto Lobbying

But fear not! Yesterday, Binance announced that they are joining the Chamber of Digital Commerce, an American lobbying group. The Chamber of Digital Commerce is probably the largest association for digital assets in the world. This entity includes some prominent platforms like MasterCard, Citi, Visa, Ripple and Circle.

How exactly will they help Binance? well here’s how Joanne Kubba, the VP of Public Affairs describes the lobby.

“As an organization at the crux of the industry’s rapid growth and complex regulatory environment, working hand in glove with policymakers, regulatory bodies, and industry groups like the Chamber is imperative for Binance,”

With dipping their toes into crypto lobbying, Binance hopes to “help establish policies that benefit and protect users.” Also, they are looking to “educate, advocate, and bring forth solutions” to help shape crypto regulation in the United States.

Last week, Reuters reported that the DOJ is split over a decision to charge Binance with money laundering and fraud charges. While they have not moved on with their decision, Binance seems to be bracing for a hard impact. And at this point, crypto lobbying seems to be their regulatory weapon of choice.

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