Binance Limits Account with Over $1M Following Law Enforcement Request

The world’s leading cryptocurrency exchange by volume, Binance, twitted about limiting an account with over $1 million. The confirmation came as a reply as the account holder, @TezosBakingBad, complained about the move.

What’s All This About?

The group holding the restricted account also turns out to be a dynamic Tezos tools patron. They tweeted about their predicament on August 25, stating how the exchange blocked their investment account on July 1.

The tweet added that Binance reset the account balance to zero, with the holder claiming to have over $1 million. Also, the tweet touched on Binance’s CZ and warned investors to avoid the trading platform.

Binance Responds

Binance reacted within ours, revealing that the ‘suspended’ account attracted the move because of a law enforcement request. However, it remains unclear which law enforcement firm triggered the action. Binance stated that it has to adhere to such recommendations like any other crypto exchange.

Also, Binance stated that the account user was aware of the move, highlighting that TezosBakingBad’s tweet attempted to mislead investors. The exchange advised the holder to communicate with the agency (if possible), and Binance had no control over the process.

The Estonia Connection

BakingBad’s LinkedIn profile shows the company has its basements in Estonia. That could explain why Binance restricted their account. Estonia introduced more AML policies early this year, including an adjusted VASP (Virtual Asset Service Providers) connotation. The modification had crypto-associated deals included in the definition.

Meanwhile, the updated law contained a provision that bans non-custodial wallets. Moreover, violating the law attracts penalties of up to 400,000 pounds. Baking Bad’s co-founder Michael Zikin also founded Atomex – a hybrid decentralized finance exchange that offers no-custodial wallets. That may have also contributed to their account limitation.

From Russian Sanctions

Early in 2022, Binance introduced limitations and adjusted its offerings to Russian users, following the EU’s 5th sanction package against Russia as the latter invaded neighboring Ukraine. That had the exchange restricting Russian trading accounts.

The residents could only trade on the crypto exchange with more than a 10,000-pound balance. Meanwhile, the limited accounts could not access Binance’s earned and staked deposits, spot, custody wallets, and futures.

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Editorial credit: Primakov /