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Binance.US faces regulatory scrutiny and operational hurdles in Alaska and Florida

TL;DR

  • Binance.US faces regulatory issues in Alaska and Florida due to public safety concerns.
  • Florida suspended Binance.US, citing immediate danger, while Alaska rejected its license renewal without giving reasons.
  • Former CEO Changpeng Zhao’s criminal charges complicate Binance’s regulatory situation.

Binance.US, the United States subsidiary of the world’s largest cryptocurrency exchange, Binance, has grappled with escalating regulatory challenges. These challenges have been compounded by the recent resignation of its former CEO, Changpeng Zhao (CZ), and ongoing investigations by the United States Department of Justice (DOJ). 

The latest setbacks involve suspending Binance.US operations in Alaska and Florida, further complicating the company’s regulatory landscape.

Florida Regulatory Action

The Florida Office of Financial Regulation, responsible for administering and enforcing the provisions of the Florida Statutes, has taken significant action against Binance.US, also known as BAM Trading. 

Under section 120.60(6) of the Florida Statutes, the office can place a licensee on emergency suspension if their operation poses an immediate danger to public health, safety, or welfare.

Based on their findings, the Florida Office of Financial Regulation determined that BAM Trading’s operation presented an “immediate danger” to the public, prompting the suspension. This regulatory action aims to safeguard the public’s interests and must adhere to procedural fairness under the circumstances.

BAM Trading, which holds a money services business license for money transmission, was initially granted this license by the Florida Office of Financial Regulation on July 16, 2020. However, it’s important to note that this license is set to expire on April 30, 2024.

Involvement of Changpeng Zhao

It is worth highlighting that Changpeng Zhao, the founder and former CEO of Binance Holdings Limited, is listed as the controlling shareholder and an indirect owner of BAM Trading. Notably, Zhao himself has been facing criminal charges related to Binance’s failure to maintain and implement an effective anti-money laundering (AML) program, according to the United States District Court, Western District of Washington at Seattle.

In addition to the suspension in Florida, Binance.US has also encountered regulatory setbacks in Alaska. The banking division of Alaska has rejected the renewal of Binance.US’s license to operate in the jurisdiction. As of now, the specific reasons for this rejection have not been disclosed to the public.

Broader regulatory landscape

These recent actions taken by regulatory authorities in Alaska and Florida indicate the ongoing crackdowns by regulators in the United States. They aim to enforce compliance within the cryptocurrency market, addressing security, transparency, and investor protection concerns.
As Binance.US grapples with these regulatory challenges, it becomes increasingly crucial for the company to work closely with regulators to address the concerns raised. The outcome of these regulatory battles will undoubtedly have significant implications, not only for Binance.US but for the broader cryptocurrency industry in the United States.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.

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James Kinoti

A crypto enthusiast, James finds pleasure in sharing knowledge on fintech, cryptocurrency as well as blockchain and frontier technologies. The latest innovations in the crypto industry, crypto gaming, AI, blockchain technology, and other technologies are his preoccupation. His mission: be on track with transformative applications in various industries.

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