In a significant move, Binance.US has announced that it will end its operations for customers in Washington state. This decision follows new regulations that have brought the crypto exchange into conflict with local authorities. The exchange will completely cease operations in the state in August 2024.
Binance.US has indicated that all accounts in Washington will be closed by August 20, 2024. The reason for ceasing operations in this state is the expiration of the operating license. However, this suspension is not an isolated case; the exchange is currently unavailable to customers in several other states and regions, including Alaska, American Samoa, Hawaii, Maine, New York, Oregon, Texas, Vermont, Guam, the Northern Mariana Islands, and the US Virgin Islands. This highlights the nationwide regulatory compliance challenges Binance.US is experiencing.
In early June, North Dakota’s financial regulator revoked Binance.US’ money transmitter license. This repeal marked the seventh state to take such action, following Alaska, Florida, Maine, North Carolina and Oregon. The North Dakota regulator emphasized that Binance.US “no longer meets the qualifications or requirements applicable to a new applicant for a money transmission license.”
The revocation of licenses in multiple states underscores the regulatory hurdles the exchange faces. The regulator justified the withdrawal as “necessary and appropriate in the public interest for the protection of citizens against unlawful acts, practices or transactions.”
These regulatory challenges are compounded by the involvement of Changpeng “CZ” Zhao, the co-founder and former CEO of Binance. Zhao indirectly owns the Binance.US exchange and exercises control over the entity. Despite his imprisonment, Zhao remains a majority shareholder in Binance.com. His connection to Binance.US has drawn additional regulatory attention and concerns about the autonomy and governance of the US entity.
Additionally, in March 2024, the U.S. Securities and Exchange Commission (SEC) accused the exchange of failing to provide sufficient information regarding the custody of customer assets. The SEC expressed dissatisfaction with the crypto exchange’s responses to questions, specifically about non-US employees’ access to client assets held by Binance.US via Amazon Web Services servers.
This investigation was initiated to determine whether Binance.US has retained full control over customer assets. Binance.US responded by confirming its compliance with all regulations and stressed that the claims about the safety of customer funds are baseless. The exchange states that it has not only met its legal obligations, but even exceeded them.
Source: https://cryptobenelux.com/2024/06/26/binance-us-gaat-activiteiten-stoppen-in-washington/
