Crypto Exchange Binance Launches Tax Reporting Tool2 min read
Crypto exchange Binance is launching a Tax Reporting Tool that will enable its users to “keep track of their crypto activities and streamline reporting requirements,” per a statement released yesterday.
“The fact is that in many countries around the world, crypto regulations are still evolving and we are all discovering the right path for this promising, young and exciting industry,” said Changpeng Zhao (“CZ”), CEO of Binance.
The new tool allows users to transfer their transaction history to a third party, and also obtain overviews of their tax liabilities. Though the tool will help users, it also comes at a time when the exchange has been under fire from regulators globally.
In recent weeks and months, CZ has been focusing his efforts on demonstrating that Binance is taking compliance and regulatory obligations seriously.
“I believe a well-developed legal and regulatory framework in the long term will be a solid foundation that truly makes crypto essential in everyone’s daily life,” CZ said on July 7. He added that the wider adoption of crypto globally demonstrates the need for “clearer regulatory frameworks in different countries.”
But despite the rhetoric, major questions about Binance continue to linger.
Binance’s difficult relationship with regulators
Binance’s history has been littered with regulatory controversy.
Last year, authorities in Malaysia said Binance was illegally operating in the jurisdiction. The announcement came several months after Malta ended its love affair with the crypto exchange too.
But this year, regulators have turned up the pressure on Binance—specifically targeting the exchange’s insistence that it is “decentralized” and operates without a headquarters.
All within the last two months, regulators in the U.K., Italy, Japan, and the Cayman Islands have all said Binance is not authorized to operate in their relative jurisdictions.
The U.K.’s Financial Conduct Authority told Decrypt that it has a “huge issue” with the exchange’s apparent lack of a headquarters. It also said that Binance Markets Limited—a UK entity that was put in place to run a Binance exchange in the country—was not up to speed on its anti-money laundering obligations.
“Putting two and two together, we obviously have issues with standards in that area,” the FCA spokesperson added.