Leading international crypto exchange Binance has dismissed claims of reportedly providing the Russian regulators with user data on crypto donations linked to President Putin’s opposition.
Reuters Claims Binance Shared User Data With Russian Intelligence
According to a Reuters report on Friday, in April 2021, Binance’s head of Eastern Europe and Russia Gleb Kostarev took meetings with Russia’s financial intelligence unit, Rosfinmonitoring (Rosfin).
Kostarev was reportedly asked by the government body to supply them with customer data, including names and addresses, that it would use to track bitcoin donated to Russia’s opposition leader Alexei Navalny. The Binance regional head is believed to have complied, later telling a colleague he didn’t have “much of a choice”.
Rosfin operates as an arm of Russia’s Federal Security Service (FSB). FSB, the successor secret service agency of the KGB, is where President Vladimir Putin’s career started.
Navalny raised millions in bitcoin donations between December 2016 and February 2021 in an effort to help his FBK foundation expose the corruption in Putin’s regime. Donations skyrocketed both after he was poisoned and later thrown in jail. Navalny’s FBK has been categorized as a terrorist organization by Rosfin.
Binance has defended itself against what it considers to be false allegations by Reuters.
“Suggestions that Binance shared any user data, including Alexei Navalny, with Russian FSB, controlled agencies, and Russian regulators are categorically false,” the crypto giant wrote in a Friday statement.
Binance noted that it had been actively lobbying Russian regulators to create a regulatory framework for cryptocurrency prior to Putin’s invasion of Ukraine in February. Binance also maintained that regulated crypto exchanges need to work hand in hand with government officials. “Today, any government or law enforcement agency in the world can request user data from Binance as long as it is accompanied by the proper legal authority. Russia is no different.”
The global exchange, however, claims it suspended any relationship-building initiatives with the Russian government after its military attack and didn’t sign any special agreements with Putin’s officials. Binance also added that it “reserves the right to reject law enforcement requests should they not stand up to scrutiny.”
Kostarev, on his Facebook page, declared it was “an absolute lie” that he and Binance exchange “leaked the data of Navalny or users to Rosfin or the FSB.”
Binance has also published email correspondence between Reuters and its representatives, which were part of the investigation findings. The company further said it would write a formal complaint to the news publication, citing hype and sensationalist journalism.
The news comes shortly after Binance announced limitations for Russian clients with balances of over 10,000 euros, in response to the European Union’s latest sanction package. The restricted accounts were set to withdrawal-only mode and will not be able to deposit any funds or trade.