Binance.US Faces Regulatory Setbacks: Operations Suspended In Alaska And Florida

Binance.US, the United States subsidiary of Binance, the world’s largest crypto exchange by trading volume, continues to face increased scrutiny and operational hurdles in a series of escalating regulatory challenges. 

Following the resignation of its former CEO Changpeng Zhao (CZ) and ongoing investigations by the US Department of Justice (DOJ), Binance.US has been suspended from operating in Alaska and Florida. 

Alaska And Florida Regulators Deliver Blows To Binance.US

According to recent court filings, the Florida Office of Financial Regulation, responsible for administering and enforcing the provisions of the Florida Statutes, has taken action against Binance.US (referred to as “BAM Trading”). 

Under section 120.60(6) of the Florida Statutes, the office can place a licensee on emergency suspension if their operation poses an immediate danger to public health, safety, or welfare.

According to the filing, the Florida Office of Financial Regulation took regulatory action based on its findings that BAM Trading’s operation presented an “immediate danger” to the public. The suspension is intended to protect the public’s interests and must be procedurally fair under the circumstances.

BAM Trading, which holds a money services business license to conduct money transmission, was granted this license by the Florida Office of Financial Regulation on July 16, 2020. However, the license is set to expire on April 30, 2024. 

Changpeng Zhao, the founder and former CEO of Binance Holdings Limited, is listed as the controlling shareholder and an indirect owner of BAM Trading. As per the United States District Court, Western District of Washington at Seattle, Zhao himself has been facing criminal charges related to Binance’s failure to maintain and implement an effective anti-money laundering (AML) program.

Regulatory Challenges Mount For Binance

In addition to the suspension in Florida, Binance.US has also encountered regulatory setbacks in Alaska. The banking division of Alaska has rejected the renewal of Binance.US’s license to operate in the jurisdiction. The specific reasons for the rejection have not been disclosed at this time.

The recent actions taken by regulatory authorities in Alaska and Florida reflect the ongoing crackdowns by the regulators toward the company to enforce compliance with the cryptocurrency market within the United States. 

Binance’s leadership changes and the criminal charges its former CEO faces have further complicated the company’s regulatory landscape.

As the situation unfolds, the company must navigate these challenges and work closely with regulators to address the concerns raised. The outcome of these regulatory battles will have significant implications for Binance and the broader cryptocurrency industry.

Featured image from Shutterstock, chart from TradingView.com