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SEC Plans On CipherTrace Contract To Track Binance Chain

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The US regulator, the Securities and Exchange Commission (SEC), is making plans to give a contract to CipherTrace, a blockchain analytics firm. This contract will help the SEC track transactions within the Binance blockchain, which host BNB, as well as being the underlying network for the Binance DEX. With Binance being one of the largest crypto exchanges the world has to offer, it’s no surprise the SEC wants to keep tabs on it.

Plans Of Contract By Tomorrow

In an official notice published yesterday by the SEC, the regulator revealed that it had concluded that the Ciphertrace was the only known risk intelligence and blockchain forensics tool that included support for the Binance Network and all the tokens associated with it. As such, the SEC made it clear that it intends to give CipherTrace a contract by tomorrow.

CipherTrace was founded back in 2015, and had its initial funding given to it by the US Department of Homeland Security and DARPA. As one would imagine with such an origin, CipherTrace helps blockchain forensic analysts in the process of tracing transactions. These kinds of tools are extremely useful for regulators, as it allows an easier way to check whether or not crypto exchanges are complying with anti-money laundering regulations. This comes beside the most obvious use, as well: Tracking fraudulent transactions as they flow through the respective blockchain network.

Keeping An Eye On You

With Binance being one of the biggest crypto exchanges out there, with its proprietary coin, BNB, being tenth-largest in the world by market cap, it’s easy to see why the SEC wants to keep tabs on it.

Ciphertrace made a partnership with Binance back in November of 2019, with support of hundreds of digital assets besides it. With its partnership, CipherTrace has access to the Binance network, and Binance itself can leverage the blockchain tracing tools and anti-money laundering controls.

The Integration Of Crypto

At the time of the partnership, Binance stated that the technology would allow for investors, developers, and regulators to browse the Binance Chain. This, in turn, would help set controls to protect exchanges and decentralized applications (DApps), as well as identify high-risk addresses.

What this means for Binance is still unclear, but the exchange has kept its nose clean, for the most part. The SEC giving CipherTrace a contract would just be a natural expression of the world turning the crypto industry into a mainstream one.

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      A journalist, with experience in web journalism and marketing. Ali holds a master's degree in finance and enjoys writing about cryptocurrencies and fintech. Ali’s work has been published on a number of cryptocurrency publications.