Brazil Fines Binance $1.7m Over Derivatives Trading Violations

Brazil has imposed a $1.7 million fine on the cryptocurrency exchange platform Binance for violations related to derivatives trading, adding to the company’s ongoing regulatory challenges worldwide.

The Brazilian Securities and Exchange Commission (CVM) announced that Binance will pay $1.7 million as a settlement after an investigation into its unauthorized derivatives trading activities in the country.

In an official statement on its website, CVM outlined the details of the case and the settlement amount Binance is required to pay.

The statement noted that during a meeting on August 13, 2024, the CVM Board reviewed proposals related to administrative sanctioning processes, including one involving B Fintech Technology Services Ltda, a company associated with Binance.

During a subsequent meeting on August 29, 2023, the CVM Board initially rejected a settlement agreement with B Fintech Serviços de Tecnologia Ltda, deeming it untimely and inconvenient.

However, on February 15, 2024, a new proposal was submitted, and after negotiations with the Term of Commitment Committee (CTC), the proponent agreed to pay CVM R$9,600,000.00 (approximately $1.7 million).

The PFE-CVM (Federal Prosecution Office at CVM) found no legal obstacles to executing the agreement, and the CTC deemed the settlement appropriate. The CVM Board subsequently approved the signing of the Commitment Term with B Fintech Serviços de Tecnologia Ltda.

CVM began its investigation into Binance’s operations in July 2020, accusing the company of offering derivatives trading services without the necessary licenses.

Initially, Binance attempted to resolve the matter by offering a $370,000 settlement, which CVM rejected. Eventually, both parties agreed on the $1.7 million settlement as outlined in the official statement by Brazil’s CVM.