Changpeng “CZ” Zhao, the founder and CEO of Binance, has refuted claims of owning CommEX, the company that acquired Binance’s business in Russia. CZ made it clear that he is not the ultimate beneficial owner of CommEX and has no shares in the company. However, he mentioned that former staff members may have joined or will join the new company.
Binance’s Zhao refutes CommEX’s ownership claims
Binance recently announced its withdrawal from Russia due to an ongoing investigation by the US Department of Justice, selling the company to CommEX. Binance and CommEX had previous interactions for testing purposes, which raised questions about the identity of CommEX, as it resembles Binance in terms of user interface and appears to be only a few days old.
Changpeng Zhao clarified in a post on X (formerly Twitter) that some former members of Binance’s cryptography and information security teams may join CommEX, and some may have already done so. However, he emphasized that he is not the ultimate beneficial owner (UBO) of CommEX and does not own any shares in the company.
Addressing concerns about the similarities in the user interface between the two exchanges, Zhao explained that the exchange requested this to ensure a seamless user experience. He also mentioned that CommEX does not provide services to users from the United States or the European Union, as they have implemented IP and KYC blocks according to the terms requested in the deal.
Zhao then officially confirmed that there is no revenue sharing or option to repurchase shares from CommEX, and they are fully exiting the Russian market with a transition period of a few months.
During this transition period, Zhao explained that crypto transfers between Binance and CommEX will occur as users migrate with their funds. He also mentioned that while there were previous transactions during the testing phase of the integrations, it is considered normal in such transitions.
The CommEX ownership dilemma
Binance’s departure from Russia was driven by regulatory pressure, but the transition to CommEX, a relatively unknown exchange, has sparked speculation. In August, Dutch users were informed that they could no longer use the exchange, and instead, they were strongly encouraged to switch to the newly established exchange, CommEX.
Notably, there are significant uncertainties surrounding CommEX. The exchange does not disclose information about its ownership or management. The only contact information provided is an email address, and inquiries about ownership have gone unanswered. Additionally, CommEX mentions that any legal disputes would be resolved in Hong Kong. Binance has also declined to provide details about CommEX’s ownership but denied that the exchange utilizes the same underlying technology as Binance.
According to a page on CoinMarketCap, owned by Binance, CommEX describes itself as a “rapidly expanding cryptocurrency exchange, backed by top-tier crypto VCs.” Still, it does not specify who these venture capitalists are.
In a statement released Tuesday, CommEX stated that it offers a wide range of product suites, including Spot, Futures, Simple Futures, and P2P services to engage with the cryptocurrency world.
The similarities between CommEX’s internal API codes and those of the exchange, along with the “one-click” exchange transition for Dutch users to Coinmerce, have also increased the suspicion about Binance’s involvement with CommEX.
Crypto enthusiasts have also pointed out striking similarities in the language used in CommEX’s and the exchange’s terms of service. That suggests that Binance might try to maintain regional control in Russia through a proxy firm akin to its approach in the Netherlands. If true, this could be a risky strategy, given the increasing scrutiny the exchange faces from regulators worldwide. Binance is now encouraging Russian users to switch to CommEX by offering a 25% trading discount for BNB holders on the newly established exchange.
On a separate note, the leading exchange faces challenges securing a banking partner in France. Regulators raided the company’s European headquarters in Paris in June as part of an ongoing investigation into alleged money laundering. With its former banking partner Paysafe no longer in the picture, the exchange now has the task of finding a replacement to continue its operations or possibly consider a sale to another newly established exchange.
