Binance US President and CEO Brian Schroeder received a federal letter demanding the immediate release of official documents proving the exchange’s various investor-centric security protocols. The request came from the chairman of a subcommittee under the US House Committee on Oversight and Government Reform.
In a letter to Schroder, Congressman Raja Krishnamurthy of the Subcommittee on Economic and Consumer Policy noted the lack of involvement from crypto exchanges in helping the US government prevent financial fraud and protect investors:
“I am concerned about the rapid growth of fraud and consumer abuse. I am concerned about the lack of clear action by cryptocurrency exchanges to protect consumers who transact through their platforms.
Krishnamurthy also expressed doubts about the vetting process behind listing tokens on crypto exchanges, which ultimately increases risk for investors. Binance US, a subsidiary of the major crypto exchange Binance, was approached by the subcommittee to produce various documents – helping to assess the depth of their aforementioned concerns.
Binance US needs to produce all the requested documents from the time of its launch and has been given a deadline of September 12, 2022 in less than two weeks to produce the same as shown below.
On behalf of the US Congress, Krishnamurthy reiterated that crypto exchanges need to ensure the safety of investors by “implementing audit policies, adopting certain disclosure, deregistration and other security mechanisms.”
In addition to the documents, Schroder was asked to answer questions to describe the tools and methods implemented by the exchange to reduce risks, fraud and fraud.
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A recent survey found that 46 percent of adult crypto users in the United States experienced losses on investments during the ongoing crypto winter.
Most of the respondents tried to invest in cryptocurrency while looking for a “different way of investment” and thought it was “a good way to make money”.