Binance.US will cease operations in Washington state in August 2024 due to regulatory issues.
Binance.US has announced that it will cease operations for consumers in Washington state, which is a significant development. This decision was made in response to regulatory changes that have resulted in the cryptocurrency exchange being at variance with local authorities. Additionally, the crypto community exchange will cease operations in August 2024.
Binance.The United States has established a deadline of August 20, 2024, for the closure of all accounts located in the state. The termination of operations in the state is due to the expiration of the operating license. Additionally, the suspension in Washington is not an isolated incident.
Customers in numerous other states and regions are presently unable to access the exchange. Alaska, American Samoa, Hawaii, Maine, New York, Oregon, Texas, Vermont, Guam, the Northern Mariana Islands, the U.S. Virgin Islands, and Vermont comprise this list. The exchange’s ongoing battle with regulatory compliance is a national concern.
The exchange’s money transmitter license was revoked by the financial market regulator of North Dakota earlier this month. This revocation was the seventh state to take such action, joining Alaska, Florida, Maine, North Carolina, and Oregon.
The order issued by the North Dakota regulator on June 4, 2024, underscored that Binance.US “has not continued to meet the qualifications or satisfy the requirements that apply to an applicant for a new money transmission license.”
The regulatory obstacles that exchange encounters are emphasized by the revocation of licenses in numerous states. The license cancellation was justified by the North Dakota regulator as “necessary and appropriate in the public interest to restrain unlawful acts, practices, or transactions to protect citizens.”
The involvement of Changpeng “CZ” Zhao, the co-founder and former CEO of Binance, further exacerbates these regulatory challenges. Zhao has been described as exercising control over the Binance.US exchange and indirectly owns it. Zhao, who is currently incarcerated, continues to retain a majority stake in Binance.com.
Consequently, his affiliation with Binance.US has prompted heightened regulatory scrutiny and apprehensions regarding the autonomy and governance of the U.S. entity. Additionally, the U.S. Securities and Exchange Commission (SEC) accused the CEX in March 2024 of failing to provide sufficient information regarding the custody of customer assets.
The SEC expressed dissatisfaction with the crypto exchange‘s responses to inquiries in a joint update submitted to a District Court in Washington, D.C. Specifically, the SEC expressed apprehension regarding the potential for Binance employees who are not situated in the United States to access customer assets that are held by Binance.US through Amazon Web Services servers.
In June 2023, the Securities and Exchange Commission (SEC) initiated an inquiry to determine whether Binance.US has maintained complete control over customer assets.