UpdatesFeb 20, 2023

Will Binance leave the US market? Changpeng Zhao explains

The world's largest cryptocurrency exchange has problems in the United States.

On Friday, February 17, Bloomberg reported that the Binance Holdings Ltd. exchange is about to terminate cooperation with American entities. This, of course, is related to the increasing pressure from US regulators, especially the Securities and Exchange Commission (SEC). However, on the same day, the company's CEO - Changpeng Zhao - denied these reports.

Changpeng Zhao says everything is fine

Before the weekend, Binance CEO Changpeng Zhao denied reports that his company was considering severing relations with business partners from the United States. This relates to an article published on Jan. 17 by Bloomberg, which said that Binance Holdings is "considering terminating its ties with intermediary companies such as banks and service companies and re-verifying venture capital investments in the US." The article also mentions that tokens from American projects, such as USDC from Circle, may be delisted from the Binance exchange.

On the same day, CZ tweeted that this was absolutely false information. Zhao also said that Binance will conduct a very thorough review of all related projects coming from jurisdictions where regulatory uncertainty still persists. The point of Binance is to make sure that clients of the exchange are completely separated from any unjustified damage that may result from the interference of institutions such as the SEC, for example.

“Binance Holdings does not serve customers in the United States, who are instead routed to the independent Binance.US,” adds Zhao.

The SEC is looking at Binance

Both Binance and its American independent arm, Binance.US, have come under scrutiny from local regulators. The US Securities and Exchange Commission (SEC) is currently investigating links between Binance.US and trading companies that have been directly linked to Changpeng Zhao.

In January, the SEC blocked the purchase of a majority stake in bankrupt cryptocurrency lender Voyager Digital by Binance.US

Last week, the securities commission officially warned Paxos, the issuer of Binance's stablecoin BUSD, that their actions are illegal in the eyes of the institution. The point was that the SEC recognized the exchange's stablecoin as a security. As a result, Paxos resigned from cooperation with Binance.

Binance generally does not want to waste time or money on any court battles, lawsuits and investigations, so it was reported that the exchange wants to reach a settlement in all possible cases in which it has been involved due to legal issues.

The company announced that it intends to reach a settlement with all supervisory institutions. Moreover, Binance is aware that it will have to incur high financial penalties as a result for failing to comply with certain regulations in recent years.