Binance cops $2 million fine for Australian spam emails, adding to crypto’s grim Christmas

It’s been a busy week for Binance, and not in a good way. The latest hit comes in the form of a $2 million fine from the Australian Communications and Media Authority (ACMA) for spam breaches.

ACMA posted the news on Thursday, confirming that the crypto exchange had paid the fine.

This was the culmination of an investigation that found Binance sent more than 5.7 million emails that either couldn’t be unsubscribed from or were difficult to opt-out of. In the latter case, consumers were required to log into their accounts to do this.

These emails were sent over a period of seven months, between October 2021 and May 2022.

“Customers should not be made to log in to stop receiving messages,” said ACMA chair Nerida O’Loughlin in a statement.

“It is very concerning that we continue to see breaches of the spam laws from large size companies that should have good compliance practices in place. The Spam Act has been in force since 2003, so there are simply no excuses.”

O’Loughlin also asserted that ACMA contacted Binance Australia repeatedly about compliance issues ahead of its investigation, but adequate action wasn’t taken.

Binance has also committed to a three-year court-enforceable undertaking that will involve an independent review of its online marketing practices.

What else is going on with Binance this week?

It’s been less than two months since Binance backed out of its FTX acquisition. Since then the crypto news cycle has been awash with its collapse, allegations of fraud, unauthorised transactions and even polyamory.

This culminated with the arrest of FTX founder Sam Bankman-Fried in the Bahamas this week.

But despite Binance taking the early moral high ground, it’s had other problems over the past few days.

Since the arrest, Binance has seen a historic rate of withdrawals from the platform. According to Decrypt, the net outflow was sitting at around US$3.66 billion in November.

The platform also paused withdrawals of the USDC stablecoin, which rose some eyebrows. But according to Binance, it was simply a token-swapping exercise.

But most alarming is that US prosecutors are considering charging Binance and its founder Changpeng Zhao with money laundering compliance issues. 

But despite being back in the headlines, it’s an investigation that has actually been underway since 2018 regarding Binance’s compliance with anti-money-laundering laws and sanctions in the US. Basically, to prove that the platform isn’t being used for nefarious purposes.

While the news isn’t exactly new, according to Reuters, this week prosecutors are torn on whether to file charges against the platform.

Of course, this is just another lump of coal to add to the crypto winter as we race towards Christmas. It’s unclear if and when things might turn around, but it’s certainly not looking good.