The exchange house will be fully compliant with US regulations. The resolution may be motivated by the recommendations that FATF will publish
Binance communicated the prohibition for users of the United States to commercialize with cryptocurrencies in its platform. The Asian company added that the resolution was accompanied by the launch of a new portal registered in that nation, which will adhere to local regulations.
After these announcements, the residents of the United States wonder what is happening with Binance, since the company has been offering exchange services for more than 150 cryptocurrencies in that country for several years. In addition, 15% of the exchange volume in Binance.com belongs to users from that country.
It was reported that the decision affected the company’s valuation on Monday, June 17th. The value of the platform’s token, known as Binance Coin, dropped 9.89%, after the blockade was announced. The price recovered in the course of the afternoon, being quoted again at $35 dollars per unit.
However, analysts say that Binance US will have to compete with Coinbase, Kraken or Geminis on equal terms. The company will decrease its offer of crypto assets, possibly focusing its business on Bitcoin and Ethereum. This seems to indicate that Binance will lose its advantage in the United States, since one of its main attractions was precisely the wide variety of cryptocurrencies admitted.
Binance: Regulated Cryptocurrency Market
The exchange house seems to have decided to avoid legal problems with the Securities and Exchange Commission (SEC) of the United States. The firm said that it will not manage operations, but will only provide its services as a wallet. The company BAM Trading Services will be authorized for the purchase and sale of cryptocurrencies in the country.
It was also reported that its subsidiary, Binance DEX, decided to make the same move with the US market, which it announced two weeks ago. According to Changpeng Zhao, CEO of Binance, it is confirmed that the board of directors has opted to offer a regulated version that pleases the authorities:
“We (Binance.com) have been working tirelessly to improve our regulatory knowledge and capabilities as we aim to provide our services in the utmost compliant and secure manner in whichever new market we plan to enter,” said Zhao.
It was noted that Binance.com users can exchange cryptocurrencies, the vast majority of which are considered by the SEC as securities. That is, all operations related to these assets are under the jurisdiction of the Authority, which can subject the exchange house to an investigation.
With the creation of a new platform complying with all US regulations, Binance can continue working in this market. Of course, the trade will be more limited, but it will not have problems with the authorities.
FATF’s Role in the Matter
It is not entirely conclusive why Binance has decided to launch this platform on this occasion. The United States has had strict regulations for cryptocurrencies for months. However, this did not seem to affect the operation of Binance.com.
Everything seems to point to the Financial Action Task Force (FATF). The intergovernmental body released on Friday, June 21st, a document to monitor the trade of cryptocurrencies worldwide. These legal recommendations could be considered by more than 200 countries, including the United States.
The publication could affect money exchange houses, as well as cryptocurrency funds and custody services, state Bloomberg experts. It was said through the media that the document could demand that startups provide information about their clients and the transactions made in their platform. Therefore, it would not be surprising if US authorities imposed these recommendations to function legally in the country.
By Willmen Blanco