13, Paxos Trust Co., Binance’s partner for stablecoin issuance, said it was ordered by the New York State Department of Financial Services to cease issuing new Binance USD stablecoins. US regulators’ recent actions, including stepped-up warnings to banks about crypto ties, are increasingly isolating Binance and other players.Įarlier this month, Binance suspended deposits and withdrawals of US dollars using bank accounts for clients after Signature Bank pulled back, Bloomberg previously reported.Ĭiting company messages and banking records, Reuters reported Thursday that Binance moved more than $400 million in the first quarter of 2021 from a bank account of Binance.US, which is supposedly a separate exchange designed for the US market, to a trading firm managed by Zhao.īinance.US responded with a statement on Twitter Thursday, saying that “while there was a market making firm named Merit Peak that operated on the Binance.US platform, it stopped all activity on the platform in 2021.” It said that Binance.US has never traded or lent out customer funds. The crackdown on Binance stablecoin BUSD, issued by Paxos, has sparked $2.3 billion in redemptions of the tokens from Monday to Thursday. The international exchange experienced a net outflow of $1.9 billion in assets, according to data estimates from Nansen. In the past week, the clampdown has taken its toll. In January, it accounted for 55% of world spot trading in crypto, according to CryptoCompare data. After FTX failed, Binance solidified its dominance in the market. “Like every other blockchain company, we are conducting a careful cost-benefit analysis and will pivot our business as necessary to protect our global user base,” a spokesperson for Binance said.īinance ended 2022 riding high, positioning itself as an exchange that had been relatively unscathed by the crypto winter. Instead, there’s Binance.US, a far smaller exchange that claims to be independent and said it has no plans to leave the US. It will consider de-listing tokens from any US-based projects, including Circle’s stablecoin USD Coin, the person said.īinance Holdings isn’t authorized to serve crypto customers in the US. Binance has been probed by the Securities and Exchange Commission, Commodity Futures Trading Commission, Justice Department and the Internal Revenue Service.īinance Holdings is looking at whether to sever ties with intermediary firms such as banks and services firms and is reassessing venture-capital investments in the US, according to the person, who asked not to be identified discussing details that had not yet been made public. The company, which operates the world’s largest crypto exchange, is weighing the retreat after its relationships with a key banking partner and stablecoin issuer ran into trouble amid intense scrutiny from authorities, according to a person familiar with the issue. is considering ending relationships with US business partners as regulators turn up the heat.
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