Binance Considers Ending US Ties Amid Regulatory Scrutiny

According to a Bloomberg report, Binance Holdings Ltd., the primary cryptocurrency exchange globally, is contemplating severing ties with its business associates in the United States due to increasing regulatory scrutiny.

According to a reliable source, the firm is considering a course of action in reaction to its difficulties dealing with an extensive banking associate and stablecoin issuer. The obstacles have come to light due to increased regulatory review by many agencies, including the SEC, CFTC, Justice Department, and Internal Revenue Service, all of which have opened investigations into the exchange.

As per the source, it has been reported that the exchange is examining its venture capital investments in the United States and contemplating the potential termination of relationships with intermediaries, such as banks and service providers.

If the exchange withdraws tokens from US-related projects, Dollar Coin, Circle’s stablecoin, may be impacted,” said the insider.

In the US, Binance Holdings is not allowed to serve bitcoin customers. In contrast, according to Bloomberg’s story, Binance.US, a much smaller exchange, claims to be self-governing and has said it has no plans to leave the US market.

Changpeng Zhao, CEO of the exchange, responded to speculations that it would remove all tokens with US addresses from its list on Twitter. He stated that the exchange is currently refraining from certain investments or bids on bankrupt US companies.

Binance Accused Of Illegally Accessing BAM Trading’s Bank Account

Binance faces further regulatory pressure as a recent report accuses it of unlawfully accessing BAM Trading’s bank account. The allegations compound the exchange’s existing compliance issues and investigations by US agencies.

Messages from the company and banking records show that the exchange moved more than $400 million from the Binance.US account at Silvergate Bank to its trading company, Merit Peak Ltd, led by CEO Changpeng Zhao.

The reasons for the transactions and if any of the funds belonged to Binance.US clients are yet unknown. The exchange’s terms showed Silvergate and Prime Trust as custodians of clients’ dollar deposits.

Related Reading | Japan To Launch Pilot Program For Digital Yen In April

The latter placed $650 million in wire transfer transfers into the Binance.US account throughout the quarter, according to bank data. Kimberly Soward, a representative for Binance.US, did not respond to specific queries on the transfers mentioned in the bank records in response to the claims.

Merit Peak was “not trading nor offering any sort of services on the Binance.US platform,” she insisted, calling the reporting “old information.” When Merit Peak’s operations ended is unknown, according to Soward.

This article conveys general information and the opinions expressed should not be considered personal advice for any individual or specific security or investment product.

Comments (No)

Leave a Reply