“Blockchain Has No Borders” CZ Denies Binance is Leaving the US
A Friday report indicated that Binance is planning to leave the US and delist the tokens of projects based in the country. Not long after, the exchange’s CEO CZ took to Twitter calling the allegations “false” and added that “blockchain has no borders”.
Is Binance Leaving the US?
A report from February 17th stated that the world’s largest Binance is preparing to exit the United States. Allegedly, the international cryptocurrency exchange is considering delisting all tokens issued by US-based projects and severing its ties with companies in the country. The decision, reportedly stemming from the recent surge in regulatory activity, would not affect Binance.US.
Not long after the report was published, Binance’s CEO Changpeng Zhao took to Twitter to deny the claims. Additionally, when another user asked “what’s even a US-based token”, CZ agreed adding that “blockchain has no borders.”
Zhao, however, also clarified that his exchange has decided to postpone certain investments in the US, as well as bids on bankrupt companies. According to Binance’s CEO, his company is waiting for regulatory approval before proceeding with the ventures. In late 2022, it was announced that Binance entered into a $1 billion agreement to acquire Voyager’s assets.
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Is Binance in Trouble in the US?
While many of the recent regulatory actions targeting digital asset firms haven’t been aimed directly at Binance, they have caused alarm bells to ring in certain parts of the community. Perhaps the most notable news when it comes to the world’s largest cryptocurrency exchange is the enforcement actions targeting Paxos.
Paxos is a well-known stablecoin issuer that, among other tokens, offers the Binance-branded BUSD. The company was recently ordered by the New York Department of Financial Services (NDFS) to stop minting BUSD, allegedly as it has proven unable to continue doing so “safely”. Furthermore, Paxos revealed it had received a Wells notice from the SEC as the Commission believes the stablecoin constitutes an unregistered security.
In a Twitter thread, Binance’s CZ explained that the matter of BUSD is not particularly troubling for his exchange and stated that the stablecoin is not a major part of its business. However, he conceded that if BUSD is found to be a security, it could have profound consequences for the future development of digital assets in the United States.
By mid-February, several stories directly related to Binance’s regulatory issues also came out. The exchange even acknowledged that its compliance was lacking in the past and that it is fully expecting to pay some fines, but added that it had since resolved said issues. More recently, a troubling report stated that Binance had access to Binance.US’—an officially independent entity—bank accounts and used the access to transfer at least $400 million to a CZ-managed trading firm. A Binance spokesperson, however, called the information “outdated”.
Editorial note (February 20th, 2023, 5:04 PM ETC): The question at the end of the article was updated to better fit the topic.
Do you think US regulators will continue taking action against BUSD? Let us know in the comments below.