Binance, the world’s largest cryptocurrency exchange, has announced its exit from the Russian market. The exchange plans to cease all exchange services and business operations in the country over the coming months. This move follows the sale of its assets to CommEX, a venture that emerged just a day ago, for an undisclosed sum.
Unlike some similar international deals in Russia, Binance has clarified that it will not retain any ongoing revenue shares from the sale or have any buyback options.
The decision to exit Russia comes two months after Binance faced allegations of helping customers move funds held in sanctioned Russian banks out of the country, which the exchange had denied. Noah Perlman, Binance’s Chief Compliance Officer, stated, “As we look toward the future, we recognize that operating in Russia is not compatible with Binance’s compliance strategy.”
CommEX, the buyer of Binance’s assets, launched on Tuesday and is backed by an unnamed “top-tier crypto VC.
Cryptocurrency exchanges like Binance have played a crucial role for many Russians who left the country following the Ukraine invasion, facilitating the movement of money in and out of Russia, as many Russian banks faced international payment system restrictions.
Binance had previously introduced a limited number of restrictions for its Russian clients, such as banning direct deals exchanging the ruble for dollars or euros. However, it had otherwise allowed users to utilize the exchange freely. In April, the exchange lifted restrictions on the €10,000 limit on the value of assets Russians could hold in their accounts.
Changpeng Zhao, Binance’s founder, announced that users holding the exchange’s in-house coin, BNB, would enjoy a 25% trading fee discount on CommEX. The transition of Russian Binance users to the new venue is expected to take up to a year, with Binance assuring that all assets of existing Russian users are safe and securely protected.
The identity of CommEX’s backers has sparked speculation within the Russian crypto community.
Despite facing regulatory investigations and falling market share, Binance remains the world’s largest cryptocurrency exchange. It is currently embroiled in lawsuits from major US regulatory bodies, including allegations of illegally accessing US customers, violating securities laws, and commingling customer funds via a separate entity owned by Zhao. Binance has expressed disappointment and pledged to contest these lawsuits.
Photo Source: Google
October 1st , 2023
Delino Gayweh
Serrari Financial Analyst
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