Regulatory agencies in Alaska and Florida have issued a banning proposal for the Binance.US platform operating in the region. The state-based regulators have noted that the trading platform may not serve the locals on account of the guilty plea of the former Binance CEO.
Binance.US received a $4.3 billion penalty in a lawsuit initiated by the CFTC and Department of Justice. The penalty was cited as one of the biggest in the history of the United States. However, it seems that regulatory troubles for the exchange platform have continued.
Florida and Alaska are two states that have asked Binance.US to halt services in the region as per a Wallet Street Journal article published on 25th January, 2024. WSJ analysts noted that the Division of Banking and Securities declined the license renewal request for Binance.US this month.
In the same manner, the Office of Financial Regulation of Florida has also published an emergency suspension for the Binance.US application for money transmitter certification. The suspension order arrived only a week after the CZ pleaded to AML violation charges on 21st November 2023.
US Federal Courts Charge Binance Former CEO with Violation of Bank Secrecy Act
The federal court of the United States charged CZ with one count of violation of the Bank Secrecy Act. Zhao stepped down from his position as Binance.US chairperson and also shifted his voting rights via proxy agreement. In this manner, his influence over Binance.US came to a halt.
At the same time, Binance appointed Richard Teng as the new CEO of the global trading platform in November, 2023. Since last year the trading platform has remained operational in USA.
Binance spokesperson noted that the firm is still fully operational and committed to serving its customers and offering them the same products and services as always. However, regulators in Arkansas, Illinois and South Dakota are two US states where the firm has remained operational based on an exclusive agreement.
This agreement mandates that the transfer of CZ’s voting rights remain irreversible. Media reports also revealed that CZ offered his $4.5 billion stake in Binance.US as a pledge to remove the travel ban before his sentencing hearing in February, 2024.
Binance’s $4.3 Billion Settlement Deal
A spokesperson for Binance.US recently noted that the firm is now focusing on the account holders as it moves towards a new phase. It seems that the trading volume of the exchange platform has started to recover for the first time in months since its settlement deal with the US regulators.
Data projections from Kaiko indicate that the trading platform has recovered around 49% in trading volume after two months of the $4.3 billion settlement deal. However, the increment was shortly followed by a multi-year decline.
Analysts have attributed the decline to the ongoing tussle with various US regulators. The spot market share of the firm dropped to 34.3% in September 2023 as per CCData projections. Nansen noted that Binance outflows in June 2023 were recorded around $2.36 billion.
On the other hand, Binance noted that the platform added 40 million new account registrations during 2023. Attorney General Merrick Garland published a press release in November noting that the settlement deal of Binance will assist the civil regulatory enforcement actions of various government agencies such as the Treasury Department and Commodity Futures Trading Commission (CFTC).