After CZ, Will Justin Sun Face Regulatory Sanctions and Fines？

Retrospective on Binance's $4.3 Billion Fine Incident

On November 22nd, Binance and its CEO CZ admitted guilt to criminal charges of money laundering and violating U.S. sanctions. They reached a settlement with U.S. regulatory authorities and agreed to pay a fine of $4.3 billion. Binance faced three charges, including violating anti-money laundering regulations, conspiring to conduct unlicensed money transfers, and violating U.S. sanctions.

The U.S. Department of the Treasury stated that Binance's misconduct included failure to prevent and report suspicious transactions related to terrorist organizations, including Hamas, the Palestinian Islamic Jihad, Al-Qaeda, and the Islamic State in Iraq and Syria (ISIS). Court documents revealed that Binance allowed at least 1.1 million related transactions, totaling over $898 million, involving Iranian customers.

Challenges Faced by Tron

According to Reuters, interviews with seven financial crime and blockchain investigation experts reveal that Tron's transactions are faster and cheaper than its larger competitor Bitcoin. As a

cryptocurrency

transmission platform associated with organizations designated as terrorist groups by Israel, the United States, and other countries, Tron has surpassed its competitors.

Merkle Science, a New York-based blockchain analysis company, CEO Mriganka Pattnaik, stated, “It used to be Bitcoin, but now our data shows that these terrorist organizations are increasingly favoring Tron.” He mentioned Tron's faster transaction times, lower costs, and stability.

Tron's spokesperson, Hayward Wong, stated that all technologies “theoretically can be used for suspicious activities,” citing the example of the US dollar being used for money laundering. Wong noted that Tron cannot control individuals using its technology and has no connection to the organizations identified by Israel.

In the wallets seized by Israel, nearly two-thirds of them (87 wallets) occurred this year. This includes 39 wallets, identified by Israel in June as belonging to Hezbollah, and 26 wallets in July identified as allies of Hamas, the Palestinian Islamic Jihad, responsible for attacks against Israel.

In response to this matter, Tron's founder, Justin Sun, stated, “Tron is a decentralized network. While we are committed to combating terrorist fundraising by integrating various on-chain analysis projects and partners, our primary goal remains to maintain decentralization.”

The risks associated with the Tron network and its founder Justin Sun are as follows:

• The event of Binance and CZ admitting guilt sets a precedent, and subsequent cases may use this as a reference. If the Tron network is used for money laundering, it could put Justin Sun at risk of violating the law.

• The United States has extraterritorial jurisdiction, meaning that U.S. laws can be applicable to actions that occur in other countries under certain circumstances. This legal principle allows the U.S. to exercise jurisdiction over certain transnational activities or crimes. The presence of Tether (USDT), a USD-pegged stablecoin issued on the Tron network, falls under the provisions of extraterritorial jurisdiction.