The modification was made in response to reports that certain Binance Link users had arbitraged the program's multi-tiered fee structure.

Binance is eliminating a gap in its Link Program that let certain premium brokerages benefit from Binance's multi-tiered pricing structure.

A Bloomberg article claims that the system's top-tier brokerage partners, which were divided into nine tiers altogether, benefited from reductions on trading fees that could be arbitraged or transferred to platform users by grouping many accounts together and occasionally even doing trading on their behalf.

By keeping the difference between their unique top-tier price features and whatever they would charge their clients, certain platforms were able to increase their revenue.

The platforms involved in the Link Program may also be able to draw in new customers by offering trading fees that are competitive and not available on the retail market.

The wider crackdown at Binance:

Although this crackdown on the arbitrage schemes used by some Link Program clients is limited to institutional clients, it indicates broader efforts by the exchange to curb platform abuse.

On June 26, Binance published an update to platform users urging them to report any suspicious activity, including fee arbitrage or violations of Know Your Customer policies by institutional accounts. Users will receive rewards for reporting confirmed cases of policy violations and dishonest individuals.

Problems with regulations

Despite difficulties with regulations in many locations, Binance never stops emphasizing its dedication to compliance.

In November 2023, former CEO Changpeng Zhao and the US Department of Justice reached a $4.3 billion settlement on allegations of violations of the Bank Secrecy Act and rules pertaining to the nation's anti-money laundering laws.

Despite being a distinct business from Binance, U.S. politicians are posing regulatory challenges to Binance U.S. North Dakota authorities canceled Binance.US' money transmitter license in June, so prohibiting the exchange from conducting business there.

The Nigerian authorities accused Binance of tax evasion and money laundering earlier this year, and Binance was also blamed for shortages in the country's local currency. Binance ultimately decided to leave Nigeria.

More recently, the Financial Intelligence Unit (FIU) of India fined the trading platform $2.25 million for allegedly violating the nation's anti-money laundering laws.