9 months ago
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In the face of the US government’s actions targeting the global Binance exchange, its domestic counterpart, Binance.US, continued its operations within the country.
Troubled crypto exchange Binance.US continues to face regulatory challenges in the United States even after the guilty plea of the former Binance CEO Changpeng Zhao. On Thursday, January 25, the Wall Street Journal reported that regulators in Florida and Alaska have asked Binance.US to discontinue its operations and no longer serve their native residents.
This month in January 2024, the Alaska Division of Banking and Securities rejected the renewal of Binance.US’s operating license.
Similarly, the Florida Office of Financial Regulation also issued an immediate suspension of Binance.US’s money transmitter license. Reportedly, this suspension came after Binance founder and CEO Changpeng Zhao pleaded guilty to violating US Anti-Money Laundering policies in November 2023.
In a resolution arrangement, CZ resigned from his position as the chair of Binance.US and ceded his voting rights via a proxy agreement. Thus, with this move, CZ relinquished his control over the company’s governance.
Binance.US Continued Operations amid Regulatory Pressure
In the face of the US government’s actions targeting the global Binance exchange, its domestic counterpart, Binance.US, continued its operations within the country. Last year in November, Binance.US wrote:
“We remain fully operational and are committed to continuing to serve our customers with the same products and services as we always have”.
In a late December development, regulatory authorities in Arkansas, Illinois, and South Dakota reportedly reached an agreement with Binance.US, allowing the cryptocurrency exchange to continue its operations in those states. However, this agreement came with Binance.US promising the irreversible transfer of voting rights belonging to its CEO Changpeng Zhao.
Following Zhao’s guilty plea, his lawyers made an attempt to pledge his substantial $4.5 billion stake in Binance.US as collateral, while seeking permission to travel to his residence in the United Arab Emirates.
His legal representatives requested Judge Jones to permit him to travel to Abu Dhabi on January 4 for a duration of one to four weeks. The purpose was to be present during the hospitalization, surgery, and subsequent recovery period of an individual whose name is redacted in the filed letter copy.
Court records reveal that the request was brought before Judge Richard Jones in a private hearing on December 29, where it was subsequently denied.
“The defendant has enormous wealth and property abroad, and no ties to the United States. His family resides in the UAE and it appears that he has favored status in the UAE. Under these circumstances the Court finds that the defendant has not established by clear and convincing evidence that he is not likely to flee if he returns to the UAE,” said Jones.
