Binance Is Illegal And Will Be Shut Down Next Year, CoinGeek Head Says

Calvin Ayre, head of CoinGeek, sees the world's largest cryptocurrency exchange, Binance, as illegal and is positive that authorities will shut it down in the next twelve months.

Ayre believes that "Binance is a scam operation" and implied that the Changpeng Zhao-led exchange is running a pump and dump scheme.

"All the tokens have the same intrinsic value; zero. They make them seem to be worth different amounts and then dump them to traders they lure in with their marketing," Ayre said in an interview with CCN.

"They are only pretending to be making profit on trading margin, they are really buying and selling to innocents who do not know this is all rigged against them."

Zhao delisted Bitcoin SV (Satoshi Vision), a cryptocurrency Ayre supports, from Binance exchange on April.

In a pump and dump, one party is slated to benefit since it premeditates the whole scheme and buys an asset at a low price and subsequently sells it for a higher value to unsuspecting investors after much hype has been generated about the asset.

While it isn't proven if Binance takes the side of the winning party in a pump and dump, its launchpad, however, maybe a new home for pump and dumps according to some crypto observers.

In 2019, Binance was able to launch ten Initial Exchange Offerings (IEO), which inherit the same characteristics of an Initial Coin Offering (ICO) but with the exception of a legitimate project offered by an IEO.

However, economist, Alex Krüger, observed back in May that a similar pattern appeared among the IEOs on Binance's launchpad where massive declines happened in just a few days after the IEO, suggesting that a pump took place before the rest of the trading public participated.

Due to the lack of regulation on the cryptomarkets, legal actions can't be pursued against those who are proven to operate pump and dumps.

Ayre's comments about Binance and Changpeng Zhao came after the exchange claimed on Thursday that it assisted U.K. authorities in tracking down a Bulgarian national who was "responsible for creating and selling phishing scripts that targeted customers of at least 53 different services."

The whole fraud operation that amounted to £41.6 million affected half a million victims.

Binance didn't specifically say what they did to help the authorities on their blog post but emphasized that their priority is security and that their duty is to protect customers from bad actors.