Binance, the world's largest crypto exchange, announced on September 27, 2023, that it was selling its operations in Russia to CommEX, a newly established community exchange. The company has also decided to withdraw from the nation entirely.
‘We have entered into a deal to sell the entirety of its Russia business’, the company announced. Their announcement follows the allegations that the US Justice Department was looking into Binance for possible violations of war-related sanctions on Moscow.
Over the next months, Binance will turn over all exchange services and business lines. The company highlighted that despite the move, they are confident to transition smoothly. Despite the shock of many crypto users in Russia who use Binance to play crypto gambling games, the company did not disclose the financial parameters of the deal.
However, they did disclose that they will not receive an ongoing revenue split or a buyback option from the sale. To lessen the worry of many, Binance promised its Russian customers that their funds were securely protected and that the process of moving them to CommEx may take up to a year.
‘As we look ahead, we recognise that operating in Russia is not aligned with Binance's compliance strategy’, Noah Perlman, Binance's chief compliance officer, said. With Binance's exit from Russia, CommEx has decided not to register users located there as a result of Russia's annexation of the Black Sea peninsula to avoid experiencing the same mistake.
Binance falls apart after clean-up of FTX crash
Aside from exiting the crypto market of Russia, Binance yet again faces another mishap. Although the company was left to clean up after FTX's crash in 2022, it is now also showing signs of falling apart. One of the exchange's co-founders reportedly told employees that the company is in a ‘do-or-die situation’ due to big staffing changes and issues with financial regulators.
‘Every fight is a matter of life and death, and the only thing that can bring us down is ourselves. We've been victorious before, and that only means we have to do it again’ Binance's chief marketing officer and co-founder, Yi He said in a memo to employees.
Binance's co-founder and CEO, Changpeng Zhao, is at the centre of the company's problems. Some at the exchange believe he should step down as he was sued by the Commodities Futures Trading Commission and the Securities and Exchange Commission for violations ranging from financial rule-breaking to lying to investors.
This isn't the first time Binance or its CEO, Zhao, has faced adversity. The chaos just seemed to reach a fever pitch over the summer. A month after the FTX meltdown, consumers began making large withdrawals, eventually removing $3 billion in a single day.
After pausing withdrawals of one currency in an effort to stop the outflow of funds. Zhao tried to play down the importance of the move. He noted that while Binance had experienced some withdrawals, this was normal market behaviour.
Unfortunately, the company's ‘normal market behaviour’ understatement appears to have become the norm, as another major withdrawal event occurred in June 2023. This circumstance is seen by many as the start of Binance’s downfall.
Coinbase CEO calls out Chase UK for improper crypto move
US Bitcoin exchange giant Coinbase CEO Brian Armstrong has spoken out against JPMorgan’s subsidiary Chase UK's plan to limit crypto transactions. Chase Bank announced that its customers in the United Kingdom would be prohibited from using their debit cards or wire transfers for crypto purchases on September 26, 2023.
This led Armstrong to criticise the bank for its ‘totally inappropriate’ approach. ‘If this is how they are going to be treated, U.K. crypto holders should just close their accounts’, Armstrong stated.
The CEO also requested that the United Kingdom's policymakers, such as Prime Minister Rishi Sunak and Economic Secretary Andrew Griffith, investigate whether or not Chase UK's practises are in line with national priorities.
Chase UK formally confirmed to Cointelegraph that the company had decided to prevent its customers from making any crypto-related transactions. This is due to a high incidence of fraud in the crypto industry.
With both popular crypto exchanges Coinbase and Binance experiencing mishaps, crypto users who engage in crypto transactions and crypto gambling games can’t help but feel worried. Nevertheless, there is still room for improvement in the crypto space.
