Report Says Binance Considering Exit From Russia Over Regulatory Pressure

Report Says Binance Considering Exit From Russia Over Regulatory Pressure

According to media reports, crypto exchange Binance is mulling over the idea of completely exiting the Russian market.

A spokesperson of the crypto exchange reportedly said that they were considering all options, which included withdrawing from the market altogether.

The reports

The Wall Street Journal reported earlier this week that Russian users on the Binance exchange had been blocked from using its peer-to-peer trading service to exchange cryptocurrencies other than the ruble.

This move comes after a report from the WSJ in the previous week that ruble trading volumes related to Russian banks that have been sanctioned were on the rise, thanks to Binance.

Back in May, Bloomberg had also reported that the US Department of Justice (DOJ) was investigating Binance for possibly violating sanctions.

US Senator Elizabeth Warren had also tweeted earlier this month that crypto exchange Binance should be investigated by the DOJ for helping Russia evade sanctions.

She added that they needed to come up with stronger regulations for the crypto markets to combat illicit finance.

Sweeping economic sanctions have been imposed on Russia by the European Union, the United States, and other countries after its invasion of Ukraine.

The sanctions

The sanctions apply to the central bank of Russia, along with other major banks in the country, as well as wealthy individuals.

This has limited the access of the country to foreign currency reserves and has also affected its ability to convert the local fiat to other global currencies.

There are several crypto exchanges that are currently operating in Russia, which include OKX and ByBit. All three of them had delisted two banks from their platforms recently.

This was in line with the US sanctions. In April last year, Binance had started to take ‘restrictive measures’ against Russian entities and users.

This had involved limiting users with an account balance of $10,900 in crypto tokens to withdrawals after the EU had rolled out a sanctions package aimed at Russia.

Legal troubles

Binance is also currently in the midst of regulatory pressure in the United States, as the exchange, along with its CEO, Changpeng Zhao (CZ) was sued by the US Securities and Exchange Commission (SEC).

The securities regulator has alleged that they were offering unregistered securities to American users. Other accusations include the exchange misleading its clients about compliance with laws in the US.

It further accused Binance of not taking measures to prevent insider trading and market manipulation. In the month of June, Binance’s partnership with PaySafe, its European banking partner had come to an end.

Moreover, the last few months have also seen the crypto exchange withdraw its applications for an operating license in Cyprus, the Netherlands, and Austria.

Other than Europe, Binance has also requested that its Australian derivatives business license be canceled.

This was a day before the securities regulator of the country announced that the license would end. Binance has also put an end to its Canadian operations.

The French authorities have also launched an investigation into Binance, as they have accused the exchange of money laundering.