Binance, as well as a handful of non-US exchanges, has continued to come under the regulatory oversight of US regulators.
Major cryptocurrency exchange Binance is set to begin restricting access to its platform by users from the US, on grounds of regulatory compliance. According to a report from The Block, the move to begin restricting access to US residents on Binance comes more than a year since the exchange first revealed it will be making such a move, and this will come as the first time it is making a direct move in that regard.
As gathered by The Block, Binance revealed it will be making this move via email sent to US users based on their IP Addresses. The email reads:
“We noted your account may be associated with the US due to an IP address you connected from in the past. In-line with regulatory requirements, we are unable to provide services to US citizens or residents. If you are a US citizen or resident, please transfer your assets out of your account within 90 days. You may consider using Binance US or other US platforms.”
Binance, as well as a handful of particularly non-US exchanges including BitMEX, Deribit amongst others, has continued to come under the regulatory oversight of US regulators and in response Binance created a United States subsidiary named Binance.US in a bid to pacify regulators. While the Binance.US is operating in the country, it is yet to gain approval to operate in all of the 50 states of the US.
Binance US Users Access Restriction: New Scheme to Avoid Regulatory Scrutiny?
While the proposed move by Binance to restrict users from the US from using its general exchange services appears to be in good faith, there have been indications that this move may be one of the exchange’s many ploys to turn regulator’s eyes from scrutinizing it.
The claim that Binance avoids the regulator’s scrutiny was revealed by Forbes after publishing a post with claims that the Cayman Island-based exchange developed complex organizational structures to deceive regulators.
“Binance Holdings Limited, the world’s largest cryptocurrency exchange conceived of an elaborate corporate structure designed to intentionally deceive regulators and surreptitiously profit from crypto investors in the United States, according to a document thought to be created by its senior executives,” the Forbes report reads.
From the details given by Forbes, Binance created a new subsidiary known as Tai Chi, and the adduced corporate documents give an inclination that the ultimate goal of the Tai Chi subsidiary is “to move revenue in the form of licensing fees and more to the parent company, Binance.”
While these claims have been refuted by Binance Founder and Chief Executive Officer Changpeng ‘CZ’ Zhao, who said Binance has always operated under the full provisions of every applicable law, the stoppage of users that are resident in the US may save the exchange some turmoil should regulators choose to probe the exchange as it recently did to BitMEX.
Benjamin Godfrey is a blockchain enthusiast and journalists who relish writing about the real life applications of blockchain technology and innovations to drive general acceptance and worldwide integration of the emerging technology. His desires to educate people about cryptocurrencies inspires his contributions to renowned blockchain based media and sites. Benjamin Godfrey is a lover of sports and agriculture.