According to The Information, Binance CEO Changpeng Zhao (CZ) considered closing its US branch earlier this year to protect the company from regulatory scrutiny.
CEO Brian Shroder The Binance.US Board of Directors voted on whether to liquidate the company, however, they were unable to reach a unanimous decision due to the fierce opposition of Binance US According to the report, Shroder is worried that the sudden shutdown of Binance.US will be detrimental to customers.
With a sizable user base, closing Binance.US will have a significant impact on liquidity issues and asset sell-offs. Even so, the decision not to sell the US branch shows that Binance is looking to confront US regulators without disrupting services.
Since the beginning of this year, the world’s largest cryptocurrency exchange has always been under the strict supervision of the regulator. On March 27, the US Commodity Futures Trading Commission (CFTC) also sued Binance and Zhao, alleging that the company knowingly offered unregistered crypto derivatives products in the US. On June 5, the US Securities and Exchange Commission (SEC) sued Binance, Binance.US, and CZ, alleging that the companies operate as an unregistered securities exchange.
According to a report from Kaiko, the Binance.US market share dropped by more than 20% to around 0.9% on June 26. It can be seen that, although CZ’s exchange quickly made moves to deny the allegations to reassure investors, before a strong opponent like the SEC, the floor still suffered a large amount of damage.
However, the regulatory “storm” is not unique to the US. The Nigerian Securities and Exchange Commission (SEC) warned investors against participating in trading as Binance is not authorized to operate here.
Despite the difficulties, Binance continues to expand its business in many parts of the world. On August 1, Binance launched a new branch in Japan, offering spot trading for 34 tokens. According to CoinTelegraph, the exchange plans to bring global users living in Japan to use Binance Japan from August 14 to comply with the regulatory framework there.
CZ stated that amid the regulatory and transparency risks associated with stablecoins, it is important to diversify. The Binance CEO emphasized being cautious with stablecoins like Tether (USDT) and acknowledged that even Binance USD (BUSD) has unforeseen risks.