Binance Calls Out Reuters with False Claim Narrative

Key Insights:

• On Friday, news hit the wires of Binance sharing user data with Russian authorities.
• Overnight, Binance responded to a Reuters report, stating that the news was “categorically false.”
• Before the user data story, Binance had announced limited services to Russians in response to the latest EU sanctions.

World-leading crypto exchange Binance has had plenty of news coverage in recent months.

In February, crypto exchanges were back in the spotlight following the Russian invasion of Ukraine.

In response to Ukrainian government calls to freeze all Russian crypto accounts, Reuters reported that Binance would block Russian client accounts targeted by sanctions but not freeze all accounts.

Binance was not alone in its position on account freezes, with several other leading exchanges choosing a similar path.

Binance Calls Out Reuters with False Claim

On Friday, news hit the wires of Binance sharing client data with Russia. According to a Reuters Special Report, Binance’s regional head met with Russia’s financial intelligence unit in April 2021. Reportedly, Russian intelligence wanted Binance to share client data to help the fight against crime.

Reuters went on to say that Russian intelligence was trying to trace Russian opposition leader Alexei Navalny’s Bitcoins (BTC) amounting to millions of dollars.

Binance’s head of Eastern Europe and Russia, Gleb Kostarev, reportedly consented to the request, saying to a “business associate that he didn’t have much choice in the matter.”

Reuters noted that Binance has continued to operate in Russia since the invasion of Ukraine. This is despite other payment platforms, including PayPal ceasing operations in the country.

In response to the Reuters report, Binance has denied that it helped Russian intelligence track down donations to Alexei Navalny.

On Friday, Binance posted,

“Suggestions that Binance shared any user data, including Alexei Navalny, with Russian FSB controlled agencies and Russian regulators are categorically false.”

Binance added,

“On the specific matter of not sharing data – today, any government or law enforcement agency in the world can request user data from Binance as long as it is accompanied by the proper legal authority. Russia is no different. Fulfilling disclosure obligations to the authorities in each jurisdiction is a large part of becoming a regulated business and Binance fulfills its legal obligations.”

Binance stated that it plans to lodge a formal complaint to Reuters. The exchange also shared a full email exchange with Reuters on Binance operations in Russia.

Binance Announces Limited Services to Russian Users

On Thursday, Binance announced that it will restrict the Russian account holders with more than €10,000 to withdrawal-only mode.

According to the announcement,

“Following the EU’s fifth package of restrictive measures against Russia, Binance is required to limit services for Russian nationals or natural persons residing in Russia, or legal entities established in Russia, that have cryptos exceeding the value of 10,000 EUR. As such, we require you to complete your proof-of-address verification.”

Binance added,

“Accounts that classify under this restriction will be put into withdrawal-only mode. No deposits or trading will be permitted on these accounts. The limit also covers all spot, futures, custody wallets, and staked and earned deposits. In addition, all deposits to accounts for Russian nationals or natural persons residing in Russia, or legal entities established in Russia with over 10,000 EUR will be restricted.”

The latest announcement comes despite Binance CEO Changpeng “CZ” Zhao reportedly stating that his exchange “would resist calls to limit services to normal people,” calling such a move unethical.