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Binance: Why is the leading crypto exchange not available in Texas?

Binance
TL;DR Breakdown
  • Binance remains under regulatory scrutiny in Texas.
  • Texas continues to regard cryptocurrency investment schemes as a danger to regular investors.
  • Investors embrace VPNs to bypass the regulatory ban on Binance.

Binance has established itself as the world’s leading cryptocurrency exchange. It did not, however, reach the top without opposition. Regulatory roadblocks have impeded Binance for the past two years.

However, a number of countries have changed their minds and allowed the crypto exchange to operate within their borders. However, that cannot be said about the state of Texas in the United States. The conservative state of Texas has held fast to its position that this particular exchange is banned within its borders.

Binance remains unwelcomed in Texas

Binance is not accessible in some states in the United States, including Texas, New York, or Florida, due to regulatory concerns. In response to a policy change by Binance, investors from these states are no longer permitted. The renowned crypto exchange established its United States office in September 2019. However, it was not available to residents of the states mentioned above and ten other states due to regulatory uncertainty.

The crypto exchange initially banned US customers in September 2019 and announced the launch of Binance.US through collaboration with BAM Trading Services to meet increasing regulatory demands. Customers in approved states had to follow more stringent know your customer (KYC) procedures than the exchange previously required, including the need to submit photographs of a valid ID and social security numbers.

During the launch, the exchanges` liaison Catherine Coley revealed that Binance US and Binance.com were two separate organizations, indicating that assets held on Binance.com could not be quickly switched between exchanges. In the earlier months of 2019, Binance.com decided to prohibit US customers from using the platform. This was a measure of compliance in light of increased regulatory supervision from the SEC and CFTC.

Binance.US, the United States affiliate of headless global crypto exchange , is now accessible in 45 US states. However, residents of Hawaii, Idaho, New York, Texas, and Vermont will have to wait for some longer to use Binance.

In March, Wyoming was the most recent to be deleted from the crypto exchanges` blacklist. US regulations have limited access to cryptocurrency trading in the state, making it difficult for traders to open accounts and purchase bitcoin.

In January 2022, Binance.US launched operations in Connecticut, where the exchange had to acquire a money transmission license from the state Department of Banking. In Georgia, the United States exchange arm needed a seller of payment instruments license from the state Department of Banking and Finance.

Since the debut of Binance.US, international Binance has come under regulatory investigation. Regulators in the United Kingdom and Italy have banned the exchange from operating in their nations, while Hong Kong and Japan officials have warned investors about it. However, the crypto exchange has managed to find its way back to Italian crypto investors. As recently as September 2021, the United States government was investigating the crypto exchange for tax fraud, money laundering, and insider trading, according to reporting by Bloomberg.

The crypto exchange has been subjected to greater regulatory scrutiny in recent months, as was evidenced by the SEC’s request for information regarding two firms belonging to its founder Changpeng Zhao. Following the SEC’s inquiry, Texas tightened its regulatory grip on the cryptocurrency exchange.

Texas view on cryptocurrency

For some time, regulators in Texas have regarded cryptocurrency investment schemes as a danger to regular investors, and they have continued to issue public warnings against possible crypto-related frauds throughout the COVID-19 epidemic. On the other hand, scammers have found a way to mask up as the leading crypto exchange so as to operate in Texas.

The Texas State Securities Board’s most recent action isn’t words but rather action: an emergency cease and desist order has been issued against a company using the Binance name.

According to an official statement, the objective of the order is a business that claims to operate from the United Kingdom and has previously been warned by securities regulators in the Philippines. They had already stated that Delta Crypt was illegally selling securities paying ‘ridiculous’ rates, calling on people to avoid it. 

Since then, the firm has apparently abandoned its former name “Delta Crypt” and launched an online investment program — while not being registered to sell securities in Texas — using various deceptive terms such as Binance Assets, BinanceAssets, and Bit Kind Ltd.

Hence, the TSSB called these offers fraudulent and deceptive, noting that Delta Crypt had neglected to disclose important information, including the prior involvement of Philippine government authorities, to its managers.

It has also neglected to advise investors about the dangers of cryptocurrency trading and has illegally engaged sale agents. This implies that the firm is committed to paying commissions regardless of registration requirements or licensure.

The TSSB is taking a tough stance against fraud in the crypto sector, recently issuing citations against two alleged Ponzi schemes with fines of $10,000 or two to ten years in prison.

Despite Binance’s regulatory ban, people have found a method to work around it by using virtual private networks (VPNs). Investors can buy, trade, and deposit coins on Binance without geo-restrictions, thanks to the utilization of a VPN. Users can also use VPNs to keep their actions secure and safe from government agencies, hackers, and ISPs.

Florence Muchai

Florence Muchai

Florence is a crypto enthusiast and writer who loves to travel. As a digital nomad, she explores the transformative power of blockchain technology. Her writing reflects the limitless possibilities for humanity to connect and grow.

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