•Binance is reportedly considering ending relationships with U.S. business partners due to a tightening in regulatory policies by the Securities Exchange Commission (SEC).
•The SEC has alleged that BUSD, a stablecoin pegged to the US dollar, is a security and sued crypto firm Paxos.
•Binance CEO Changpeng Zao (CZ) denied the allegations in a Twitter post.
Binance Considering Cutting Ties With U.S Business Partners
Crypto exchange Binance is reportedly mulling over ending relationships with U.S. business partners due to tightening regulations from the Securities Exchange Commission (SEC). The SEC has alleged that BUSD, a stablecoin pegged to the US dollar, is a security and has sued crypto firm Paxos as a result of this.
SEC’s Allegations Against BUSD
The SEC’s allegations against BUSD have caused tension between exchanges and U.S regulators; resulting in uncertainty for firms operating within the jurisdiction of the United States. In response to these allegations, Binance CEO Changpeng Zao (CZ) denied them in an official statement on Twitter.
Controversy Around CZ & Merit Peak
Recently CZ and his trading firm Merit Peak have been embroiled in controversy regarding alleged transfers of $400 million from “secret” accounts associated with Binance’s subsidiary BinanceUS; involving crypto-friendly bank Silvergate Bank. Merit Peak was incorporated in British Virgin Islands in 2019 and had invested over $1 million into Binance’s subsidiary at that time – though according to spokesperson Kimberly Soward it isn’t trading or providing services on the platform currently, only U.S employees have access to it..
Crypto Space Feeling Pressure From Regulatory Climate
Due to intense scrutiny from U.S regulators, investment discretion among crypto investors has increased significantly as we move into Q1 2021 – despite recording significant gains throughout 2020 during its bull run period.. This has caused many questions amongst cryptocurrency investors as they remain uncertain about how future regulatory policies will affect their investments going forward .
Overall, it appears that there are still many uncertainties surrounding cryptocurrency exchange operations within US jurisdictions as well as heightened investor caution due to regulatory pressures; particularly concerning companies such as Binance which operate outside of American regulations but still conduct business within its jurisdiction through its subsidiary firms such as BinaceUS