Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
bitcoin
Bitcoin (BTC) $ 28,387.61
ethereum
Ethereum (ETH) $ 1,807.32
tether
Tether (USDT) $ 1.01
bnb
BNB (BNB) $ 327.75
usd-coin
USD Coin (USDC) $ 1.00
xrp
XRP (XRP) $ 0.445209
cardano
Cardano (ADA) $ 0.373976
staked-ether
Lido Staked Ether (STETH) $ 1,803.48
matic-network
Polygon (MATIC) $ 1.15
dogecoin
Dogecoin (DOGE) $ 0.075531
solana
Solana (SOL) $ 22.62
binance-usd
Binance USD (BUSD) $ 1.01
polkadot
Polkadot (DOT) $ 6.31
shiba-inu
Shiba Inu (SHIB) $ 0.000011
tron
TRON (TRX) $ 0.067943
litecoin
Litecoin (LTC) $ 81.26
avalanche-2
Avalanche (AVAX) $ 17.50
dai
Dai (DAI) $ 1.00
uniswap
Uniswap (UNI) $ 6.34
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 28,445.62
chainlink
Chainlink (LINK) $ 7.67
the-open-network
Toncoin (TON) $ 2.42
cosmos
Cosmos Hub (ATOM) $ 11.82
leo-token
LEO Token (LEO) $ 3.38
ethereum-classic
Ethereum Classic (ETC) $ 20.47
monero
Monero (XMR) $ 153.49
okb
OKB (OKB) $ 44.81
bitcoin-cash
Bitcoin Cash (BCH) $ 133.04
stellar
Stellar (XLM) $ 0.093451
filecoin
Filecoin (FIL) $ 5.84
aptos
Aptos (APT) $ 12.15
true-usd
TrueUSD (TUSD) $ 1.01
lido-dao
Lido DAO (LDO) $ 2.38
hedera-hashgraph
Hedera (HBAR) $ 0.063579
quant-network
Quant (QNT) $ 129.45
crypto-com-chain
Cronos (CRO) $ 0.0715
near
NEAR Protocol (NEAR) $ 2.04
vechain
VeChain (VET) $ 0.023356
algorand
Algorand (ALGO) $ 0.232704
blockstack
Stacks (STX) $ 1.15
internet-computer
Internet Computer (ICP) $ 5.17
apecoin
ApeCoin (APE) $ 4.07
fantom
Fantom (FTM) $ 0.482589
the-graph
The Graph (GRT) $ 0.151759
eos
EOS (EOS) $ 1.16
the-sandbox
The Sandbox (SAND) $ 0.661213
aave
Aave (AAVE) $ 78.27
decentraland
Decentraland (MANA) $ 0.608686
elrond-erd-2
MultiversX (EGLD) $ 43.36
tezos
Tezos (XTZ) $ 1.18
Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
Hodl Ninjas
Home Markets

The Tai Chi Report

Exposing Binance's SEC Relationship

Dennis Chen by Dennis Chen
March 8, 2023
in Markets, News
0
The Tai Chi Report

What role did Harry Zhou play in Binance's Tai Chi strategy?

Share on FacebookShare on Twitter

Binance is in hot waters again, but this time it’s not for misappropriating user funds like FTX or using not backing up their claims. No, this time, it’s for a certain report by the codename ‘Tai Chi.’ 

This past Sunday, the Wall Street Journal reported specifically on internal communications that poke larger holes in Binance’s oft-repeated assertions that Binance.US is an independent entity free from the international site’s influence. 

Binance claims the U.S. site merely licenses the international exchange’s technology and brand. 

More Details About the Tai Chi Strategy

However, these claims were exposed as an elaborate subterfuge as early as 2020, when Forbes reported on Binance’s illegal ‘Tai Chi’ strategy. Bam Trading Services, the company that controls Binance.US, just so happens to be under the purview and control of Binance’s now infamous and ever-so-slightly controversial founder Changpeng ‘CZ’ Zhao.

Despite Binance’s constant denials, Reuters subsequently confirmed the existence of the Tai Chi strategy, which involved setting up a supposedly independent, regulatory-friendly U.S. licensed operation to distract attention from Binance.com’s ongoing reliance on U.S. customers for a significant chunk of its business. 

In the new investigation, revelations include frantic messages from a Binance software developer in September 2019 after a Shanghai-based staffer mistakenly allowed trading on Binance.US ahead of the exchange’s scheduled launch. 

CZ replied that the culprit was “a guy here in Shanghai, mistake operation.” 

Who’s Controlling the Infrastructure?

The Binance.US tech infrastructure was controlled from Shanghai until at least mid-2021, and the Shanghai software team was contracted by the international Binance, not the U.S. version.

A Binance US spokesperson told the Journal that U.S. customer data was stored in the U.S., and there was no commingling of user data between the two allegedly independent entities, or so they said (clearly, that was determined to be untrue). 

One month before Binance.com allegedly cut off its U.S. customers, Binance’s then-Compliance Chief Samuel Lim posted a message in a Binance chat on Telegram suggesting ways for Binance.com to retain its U.S. customers, who at the time accounted for over 18% of Binance.com’s page views. Among Lim’s suggestions for U.S. customers? 

“Have them be creative and VPN [virtual private network].” 

Last month, Reuters revealed that CZ had more control over Binance.US’s bank accounts than the latter company’s CEO. Over the first three months of 2021, Binance transferred $404 million from Binance.US accounts at California’s Silvergate Bank to a CZ-controlled company, leading the then-CEO of Binance.US Catherine Coley to contact a Binance.com exec to complain that “no one mentioned” these “unexpected” transfers to Binance.US staff. 

Difference Between Binance and Binance.US

“Assertion that Binance.US is fully independent is eerily similar to claims Sam Bankman-Fried made regarding the distinction between FTX.US and FTX—claims that appear to be false, given that FTX.US has filed for bankruptcy, its users have lost access to their funds, and its new CEO has declared that it is, in fact, insolvent.” 

Harry Zhou, the architect of Binance’s ‘Tai Chi’ strategy, took to Binance’s Telegram channel to call the Google Form gaffe “, particularly concerning here because this form has to do with opening client accounts. If I were an [attorney general], I would cite this as evidence that it is, in fact, Binance, an ‘unregistered foreign-based [money services business]’ onboarding the US clients.” 

Zhou won praise from Binance’s then-CFO Wei Zhou for reminding employees to avoid mimicking a Binance.com ‘tone’ when writing copy that would appear on Binance US. Wei Zhou concurred, urging staff to 

“Sit in ‘Binance.US’ shoes when drafting.”

ShareTweetPin
Previous Post

Coindesk Journalists Win Prestigious Award for FTX Story

Next Post

Bybit Shutters Its Doors

Dennis Chen

Dennis Chen

Dennis Chen has spent over a decade working in corporate finance and an MBA from USC. His research focuses on how defi is disrupting traditional finance spaces. He joined the Hodl Ninjas team to help amplify awareness of great crypto projects.

Related Articles

Coinbase's USDC Depegs for First Time
Defi

Coinbase’s USDC Depegs for First Time

March 21, 2023
What Happened with Silicon Valley Bank
Markets

What Happened with Silicon Valley Bank?

March 20, 2023
FTX Finally Reveals How Much They Lost
Exchanges

FTX Finally Reveals How Much They Lost

March 13, 2023
Silvergate Edges Collapse
News

Silvergate Edges Collapse

March 10, 2023
Next Post
Bybit Shutters Its Doors

Bybit Shutters Its Doors

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Trending Articles

  • Sam Bankman-Fried Charged

    Sam Bankman-Fried Charged

    0 shares
    Share 0 Tweet 0
  • Enter Worldcoin: An Eccentric Project Archiving the World’s Eyes

    0 shares
    Share 0 Tweet 0
  • Top 10 NFT Marketplaces for 2022

    0 shares
    Share 0 Tweet 0
  • Beginning of the Stablecoin End?

    0 shares
    Share 0 Tweet 0
  • Inside the Digital Asset Anti-Money Laundering Act

    0 shares
    Share 0 Tweet 0
bitcoinBitcoin
$ 28,387.61
$ 28,387.61
0.01%
ethereumEthereum
$ 1,807.32
$ 1,807.32
0.58%
tetherTether
$ 1.01
$ 1.01
0.37%
solanaSolana
$ 22.62
$ 22.62
1.43%
cardanoCardano
$ 0.373976
$ 0.373976
8.33%
polkadotPolkadot
$ 6.31
$ 6.31
0.9%

Become a Hodl Ninja.

Stay on top of market trends, find exciting new projects, hold on for dear life.

johnsmith@example.com
© 2021 Hodl Ninjas – A BettorView Brand.
No Result
View All Result
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe

© 2021 Hodl Ninjas - A BettorView Brand.

Subscribe to Hodl Ninjas

Get the latest news in crypto and be the first to hear about exciting new projects.

Enter your email address

No thanks, I’m not interested.

Search
$ USD
  • $ USD
  • € EUR
  • ₹ INR
0
Previous 25
Next 25
#CoinPriceMarketcapVolume (24h)SupplyChange (24H)Price Graph (7D)
Previous 25
Next 25