Binance, a largest cryptocurrency exchange, disclosed customer and transaction information of Yuri Belenkiy, an IT specialist with a Russian passport and Bulgarian residency, with Russian authorities amid exchange’s reported exit from Russia in 2023.
The disclosure reportedly covered more than transaction information such as Belenkiy’s personal information, passport, and Bulgarian residency information.
Belenkiy was also accused by Russia’s Investigative Committee of terrorism financing following allegedly sharing approximately $700 through Binance. The case file included transaction details that the committee cited as the basis for terrorism financing charges.
Information Disclosure and Privacy Issue
Russia’s Investigative Committee noted that Belenkiy made the payments from January 2023 to March 2024 following an online fundraising appeal from Ukraine supporter advocate Arkady Babchenko.
The committee also scrutinized Binance’s record to determine whether other donors had donated to the advocate. However, it remains unclear whether Binance complied with the information about the exchange.
The case is notable because Binance reported its complete withdrawal from Russia in September 2023, noting legal compliance concerns. It also increased concerns about how Binance’s manage the customer information following its Russia withdrawal.
Mike Bystrov, who is represented Binance way back, underscore that the exchange was not required to share the information to Russia authorities and may possibly cause to raise issue under EU data privacy law.
It also remains that Belenkiy’s Bulgarian residency is not clear whether Binance listed him for EU residency.
Regulatory Compliance
Binance cited that they do not violate laws, and they properly cooperate with lawful law enforcement requests globally, subject to applicable laws, privacy data act, and regulatory requirements.
Richard Teng, Binance CEO, highlighted that this responsibility applies to all regulated financial institutions and does not mean they agreed to any actions of a specific government.
Russia Withdrawal Speculation
The disclose of information also triggers Binance’s 2023 Russia exit.
In 2023, Binance moved its Russian operations to CommEX which trigger over its similarities to Binance, addressing speculation that it was a white-label Binance Cloud exchange. Furthermore, it disputed its operation in May 2024.
The recent disclosure has renewed concerns regarding Binance’s former Russian operations and its managing of customer information after its withdrawal.
Overall, it remains unclear whether Binance classified Belenkiy as an EU resident, whether his Bulgarian residency influenced the exchange’s obligations, or if the information on other donors was also disclosed with Russian authorities.
