One of Germany’s top financial regulators, Ba Fin, is examining Coin Bene with a keen eye.

No License, No Trading

Coin Bene is a popular cryptocurrency exchange, and the platform is allegedly operating without a license in Germany and abroad. The country isn’t taking too kindly to the news and has issued a warning to the company saying it is time to get that license or face the risk of permanent shutdown.

In addition, Coin Bene is also being accused by the nation’s government of hiring “freelance traders to perform trades on behalf of the exchange.”

In a special announcement, Ba Fin explains:

Coin Bene LTD Germany is not registered in the commercial register. The company recruits freelancers whose job it is to trade cryptocurrencies for customers of the company for commission payments. The freelancer should provide his or her own bank account and perform trades prescribed by the company through cryptocurrency trading platforms. Cryptocurrencies are usually financial instruments. Trading in financial instruments on behalf of customers is subject to authorization under the KWG.

It’s amazing what some cryptocurrency companies are allegedly trying to get away with. Recently, Live Bitcoin News reported that popular crypto platform Ripple was under attack by a financial auditing firm that says the enterprise underreported several of its earnings by nearly $50 million. To be fair, Ripple is valued at several billion, but even a company that size would likely understand the prospects of $50 million suddenly vanishing into thin air.

It’s possible that Ripple was just off in its math, but the situation certainly calls for a few raised eyebrows.

Coin Bene is presently denying all allegations against it, and says that it doesn’t, nor has it ever operated an office in Germany. It also says that any job postings asking for freelancers to trade on behalf of its customers were fake.

The company states in a Twitter message:

We received numerous inquiries regarding our alleged hiring in Germany, but Coin Bene is not planning to open any office, nor hiring any representative in Germany. Nonetheless, we would like to thank those who actively reached out to us for your concern and understanding.

Who, Exactly, Are You Trading for?

If freelancers are carrying out trades for customers, these would be ongoing examples of unregulated trades, and likely to carry very serious consequences for all parties involved. At the same time, it’s a little hard to simply trust Coin Bene and assume it’s telling the truth about anything given it already potentially lied to customers back in April.

During that month, several million in crypto funds were moved off the exchange. This caused rumors of a hack to spread around, though Coin Bene claimed it was only performing maintenance. Cybersecurity firm Cipher Trace ultimately discovered that $105 million was ultimately moved “during the time of a hack.”

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