Binance, the world’s largest cryptocurrency exchange, has announced its full exit from Russia with a sale to a newly launched exchange. This move comes as a response to the firm’s compliance issues related to Western sanctions imposed on Russia.
In August, Binance began considering an exit from the Russian markets following reports of its continued support for sanctioned Russian banks on its platform. While the crypto exchange has since severed ties with these financial institutions, it seems set on also permanently discontinuing its operations in Russia.
Binance Sells Russia Business To CommEX
In a statement published on Wednesday, September 27, Binance disclosed that it has reached an agreement to sell the entirety of its Russia business to CommEx. This comes just a day after CommEx announced its official launch.
Although the financial details of the deal were not revealed, Binance highlighted that this sale represents its full exit from Russia. “Unlike similar deals from international companies in Russia, Binance will have no ongoing revenue split from the sale, nor does it maintain any option to buy back shares in the business,” the Seychelles-based exchange noted.
Furthermore, the crypto company said it will wind down all its services and business lines in Russia over the next months. Binance will also partner with CommEx to inform users how to migrate their crypto assets to the new exchange.
Noah Perlman, Binance’s Chief Compliance Officer, acknowledged that the company’s compliance strategy is one of the reasons behind this move.
Perlman said:
As we look toward the future, we recognize that operating in Russia is not compatible with Binance’s compliance strategy. We remain confident in the long-term growth of the Web3 industry around the world and will focus our energy on the 100+ other countries in which we operate.
Binance added that the off-boarding process would take up to a year to ensure a seamless transition for existing Russian users. “All assets of existing Russian users are safe and securely protected,” the crypto exchange asserted.
CommEx will offer cryptocurrency trading services, including spot, futures, and peer-to-peer trading. Interestingly, CEO Changpeng “CZ” Zhao mentioned that holders of the exchange’s native token, BNB, will “continue to enjoy” a 25% trading discount on CommEx.
Everything will be done to ensure a smooth transition. All user funds are safe!
Also:
Among other things, #BNB holders will continue to enjoy a 25% trading fee discount on @CommEX_com.
— CZ 🔶 Binance (@cz_binance) September 27, 2023
US Department Of Justice Lurks?
Binance has been facing scrutiny from regulatory bodies from various countries worldwide. Specifically in the United States, the exchange finds itself in the crosshairs of various regulators, including the Commodities Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
The SEC filed a lawsuit against the world’s largest exchange in June for allegedly violating securities rules and misusing customer funds. Meanwhile, the CFTC charged the cryptocurrency company in March for willful evasion of federal law.
Bitcoinist recently reported that Binance and CEO Zhao potentially face criminal charges and substantial fines from an ongoing Department of Justice (DOJ) investigation. Notably, the Justice Department had investigated the exchange on its alleged continuous support for sanctioned Russian banks.
The cryptocurrency total market cap on the daily timeframe | Source: TOTAL chart on TradingView
Featured image from Unsplash, chart from TradingView
