Chagri Poyraz is the Global Sanctions Lead at Binance, with nearly two decades of experience managing risk and creating industry-leading compliance programs. Here, he shares his thoughts on Binance's commitment to compliance and how we work to prevent people from blocked jurisdictions from using our platform.

Since we became a company, a culture of compliance has been introduced to every employee every day. In addition to establishing a culture, we have invested tens of millions of dollars in our program and grown our internal cadre of compliance professionals to approximately 750 high-level experts. We are confident, today our program is similar to what you will find at most traditional financial institutions, many of which have been in business for over a century compared to Binance which was founded in 2017.

One of the key elements of the program is our Sanctions Compliance sector, whose job is to ensure that people residing in blocked jurisdictions do not use our platform, and our team is very good at what they do. There are people who are not allowed to access Binance because of where they reside. We understand their side, but this is non-negotiable – it is the law. The United States is obviously not a sanctioned country, but we have strict rules to ensure that US residents cannot access our global exchange, Binance.com.

All over the world, there are people who tend to be intelligent and ruthless, using various techniques to try to circumvent these restrictions. To contain them, our Sanctions Compliance team has multiple levels of control. But just like any other regulated organization, this is an ongoing battle as new technologies and strategies are being developed by bad actors every day.

A basic measure we use to prevent these users from accessing the global platform is to observe their IP addresses.

Now, we are aware that people use VPN services to hide their IP addresses for various reasons. We don't assume that everyone who uses a VPN is malicious or sanctions violating: we treat the VPN, first and foremost, as a privacy tool. To put it bluntly, society has become extremely comfortable bypassing local regulations and company terms of use, particularly on streaming platforms like Netflix, Disney+, Spotify, and many others. Although some may turn a blind eye to this type of activity, we implement cutting-edge technologies to solve these problems.

In addition to VPN detection, Binance uses several other tools and indirect indicators to determine with high accuracy whether a user has distorted residency information in an attempt to misuse the platform. (Binance cannot list all the techniques used to avoid giving these bad actors a roadmap to evade our controls).

If we suspect that a user is physically in a sanctioned or blocked country, our system will trigger an information request, asking about the reasons and circumstances of the user's presence in the country. This can be uncomfortable for our users, but it is a strict control that ensures we remain compliant.

Again, this is an ongoing battle, people are constantly investing in ways to try and bypass the most sophisticated restrictions and controls, including using fake identities and various ways to manipulate their location. We are committed to immediately identifying and deleting these individuals, our Sanctions Compliance team has unmatched experience, advanced technology, sophisticated controls and processes to enforce the rules and ensure Binance is in full compliance. We are committed to continued investment in these controls to keep us ahead of the game.

Further reading

  • Binance Compliance Team Knowledge

  • Sanctions-related risk management talk at Kharon Global Summit