CommEx Acquired by Binance’s Former Employees
CommEx, the company that recently acquired Binance’s Russian division, has clarified that it is not owned by Binance. However, it has revealed that some of its core members are former employees of the exchange. In an open letter, CommEx stated that it is an independent entity separate from Binance, but did not disclose its ultimate beneficial owner (UBO).
“We are a vibrant and efficient start-up team, made up of dozens of passionate individuals from diverse backgrounds. Some of our core members are former Binance veterans who bring invaluable crypto and internet technology experience.”
CommEx has been working on developing its platform for the past six months and has hired ex-Binance employees during this period. This has facilitated indirect connections and knowledge exchange between the two entities, despite Binance not having any ownership stake in CommEx.
CommEx Incorporates Binance’s Design
In addition to hiring former Binance personnel, CommEx has also incorporated certain elements such as design, APIs, and terms of use from Binance. The exchange mentioned that although their current product may be basic, their tech and product teams will strive to provide the best user experience in the market.
Binance CEO Changpeng Zhao confirmed this and highlighted that CommEx does not serve users from the United States and Europe, as agreed upon in the deal. He stated that CommEx’s design and APIs are similar to Binance to ensure a smooth user experience.
However, the lack of information about CommEx’s owners, coupled with the presence of ex-Binance employees and similarities in website design and APIs, has led to speculation about Binance’s hidden ownership of the company. Venture capital firm Cinneamhain Ventures’ partner Adam Cochran even suggested that CommEx might be “just another shell company by Binance.”
Binance’s Declining Market Share
Binance has experienced a significant decrease in market share among non-dollar crypto exchanges. In August, its market share among major Asian players dropped to 54% and is expected to fall below 51% in September. This decline comes after Binance held a 75% market share at the end of 2022.
The regulatory pressure faced by Binance is a major factor contributing to its declining market share. The SEC sued Binance and its CEO for operating an unregistered exchange and violating federal securities laws. The exchange has also encountered regulatory challenges in European countries like Belgium and Austria as it prepares to comply with upcoming EU regulations.
Additionally, Paysafe, Binance’s European payments partner, has ended support for the exchange’s customers.
Hot Take: Binance’s Influence on CommEx Raises Questions
The acquisition of Binance’s Russian division by CommEx has raised questions about the extent of Binance’s involvement with the new company. While CommEx claims to be an independent entity, the presence of former Binance employees and similarities in design and APIs have led to speculation about hidden ownership.
As Binance faces regulatory challenges and a decline in market share, the relationship between Binance and CommEx adds another layer of complexity. Only time will reveal the true nature of their connection and its implications for the crypto industry.
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