North Dakota Financial Regulator Withdraws Binance.US License
North Dakota’s financial regulatory authority has taken action against Binance.US, revoking its money transmission license, making it the seventh state in the US to do so. The move follows similar actions by Alaska, Florida, Maine, North Carolina, and Oregon. Despite ongoing regulatory scrutiny of the broader Binance exchange by the US government, its domestic affiliate continued to operate within the country. The state issued an order citing non-compliance with North Dakota regulations and referencing the subsidiary’s majority beneficial owner, Changpeng Zhao, in relation to US anti-money laundering law violations. Binance.US has not responded to requests for comment.
Prosecutors Focus on Binance for Security and Legal Issues
In the US, Changpeng Zhao, Binance’s primary shareholder, faced legal challenges after pleading guilty to money laundering offenses. Despite his conviction, Zhao remains a key figure in Binance’s operations. Prosecutors have criticized Binance for lax security measures, allowing criminal activities to thrive on the platform. They allege that the exchange’s inadequate oversight led to suspicious transactions, potentially involving designated terrorist groups. Additionally, Binance reportedly failed to report certain transactions and received proceeds from ransomware attacks, resulting in a hefty penalty. As part of a settlement, Zhao paid substantial fines to regulatory authorities.
Florida Court Ruling Overturns Binance US Block
North Dakota’s regulator highlighted Binance.US’s failure to comply with permissible investment requirements and maintain an effective anti-money laundering program, violating the Money Transmitters Act. The regulator justified the license revocation as necessary to protect citizens from illegal activities. In a separate legal development, a Florida appeals court recently overturned a ruling that prevented Binance from operating in the state. The court cited insufficient justification by regulators for blocking Binance’s operations.
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Hot Take: The Future of Binance in the US
As regulatory pressure mounts on Binance and its affiliates in the US, the future of the exchange remains uncertain. With multiple states revoking licenses and legal challenges looming, Binance’s ability to operate within the country may be significantly constrained. For crypto investors and users of Binance’s platforms, closely monitoring regulatory developments and compliance efforts by the exchange will be crucial in navigating this challenging landscape.
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