Binance Considers Cutting US Ties in Face of Crypto Crash: Bloomberg
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Binance Holdings, the world’s largest crypto exchange by trading volume, is considering cutting ties with US business partners as various government agencies and regulators continue to investigate the company, according to a Bloomberg report, citing a person familiar with the matter.
Binance founder and CEO Changpeng Zhao wants to end relationships with US banks and service firms, and is also reevaluating its US venture capital investments, according to Bloomberg’s source. Binance is also considering removing tokens issued by US-based projects, including Circle’s USDC stablecoin, Bloomberg wrote.
Shortly after the report was published on Friday, Zhao wrote denied The exchange considered removing tokens linked to US-based projects on Twitter, adding blockchain “has no borders”.
“We pulled back on some potential investments, or bids on bankrupt companies in the US for now. Apply for permission first,” Zhao said in another tweet.
The New York Department of Financial Services earlier this week took action against Binance-branded stablecoin Binance BUSD, which is issued by Paxos, and Binance has also come under scrutiny for its transactions with cryptobank Silvergate. The crypto exchange has been investigated by the US Securities and Exchange Commission, the Commodity Futures Trading Commission, the Justice Department and the Internal Revenue Service.
US regulators have been cracking down on crypto players for the past couple of weeks, leaving Binance bracing for SEC fines after crypto exchange Kraken was forced to shut down its US betting service and pay a $30 million fine.
Binance’s US customers are served by Binance.US, which claims to operate completely independently and says it has no plans to leave the US, according to Bloomberg.
Earlier this month, Binance said it was temporarily suspending US dollar wire transfers from its customers.
“Like any other blockchain company, we conduct a careful cost-benefit analysis and will pivot our business as needed to protect our global user base,” a Binance spokesperson said in an email to CoinDesk.
UPDATE (Feb 17 16:00 UTC): Adding further details.
UPDATE (Feb 17 16:18 UTC): Adds extra background.
UPDATE (Feb 17 16:42 UTC): Adding Changpeng Zhao‘s comments on Twitter in the third and fourth paragraphs.
UPDATE (Feb 17 16:50 UTC): Adding comment from Binance in last paragraph.
