Binance.US To Halt Dollar Deposits After SEC Crackdown

Binance.US, the U.S. affiliate of cryptocurrency exchange Binance, announced that it would halt dollar deposits and urged customers to withdraw their funds by Tuesday following a request from the U.S. Securities and Exchange Commission (SEC) to freeze its assets. Reuters reports: Binance.US, the purportedly independent partner of Binance, said in a tweet on Thursday that its banking partners were preparing to stop dollar withdrawal channels as early as June 13. The SEC sued Binance, its CEO and founder Changpeng Zhao, and Binance.US's operator on Monday, in a dramatic escalation of a crackdown on the industry by U.S. regulators. The SEC sued major U.S. exchange Coinbase a day later.

Binance.US said in the tweeted customer notice that it would no longer accept dollar deposits as part of plans to change to a "crypto-only exchange". It called the SEC's civil charges "unjustified" and said it would "vigorously defend" itself. The SEC alleged in 13 charges on Monday that Binance had in a "web of deception" artificially inflated trading volumes and diverted customer funds, as well as failing to restrict U.S. customers from its platform. The SEC on Tuesday asked a federal court to freeze Binance's U.S. assets. Binance.US called the motion "unwarranted", saying it had addressed SEC concerns over the safety of customer assets.

The SEC said it had not received "sufficient reassurance" that Binance.US's customer assets were controlled by its operator, BAM Trading, "rather than under the control or influence of Binance or Zhao, a person who has openly expressed his desire to avoid compliance with U.S. law." Zhao and Binance had "free reign" to handle Binance.US assets, the SEC said. "They have exercised this control over U.S. investor assets with no oversight or controls to ensure that those assets are properly secured," it added. . It has said it would "defend our platform vigorously," saying the SEC was limited in reach as Binance was not a U.S. exchange. Binance.US's customer assets total more than $2.2 billion held in crypto and some $377 million in U.S. dollar bank accounts, the SEC said.

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[SuperKendall]

Given a deadline of June 13th, don't let the door close before you can escape!

They're gonna let somebody else launder the money

[rsilvergun]

hence "crypto only exchange". That's still not going to protect them from the SEC. They're gonna have to do KYC like banks do, and they're not going to do it because they can't. Nobody would use crypto if they couldn't launder money. So they'll run a few years illegally, pay a fine, do a few more years, pay another fine, and then shut down before the owners get tossed in jail.

Re:

[Powercntrl]

Running as a crypto-only exchange enables them to operate out of reach of US laws, unless the US decides to ban access to the site. You only need to deal with the traditional finance industry when you're dealing in real money. When your site is just an exchange for pretend internet money, your server can be in Russia for all it matters.

Thing is, the SEC has it in for Coinbase too, and that's a major on-ramp for turning US dollars into crypto and vise-versa. If there's no way to easily get fiat in or out

Re:

[TheRealMindChild]

Bitcoin was used plenty for buying drugs and paying hookers before buying and trading on an exchange became a common thing. You either mined your own, or bought from someone who had some, through IRC, Web forums, and Paypal. And plenty of trading for dollars irl. It did just fine.

This might be the end to the endless shitcoins, but BTC isn't going away if exchanges get the boots put to them. I doubt ETH is either.

Re:

[Gibgezr]

But if the drug-dealers can't exchange shitcoins for actual money, they won't be selling you drugs for shitcoins.