Binance’s partner, the issuer of the USD stablecoin, BUSD, has been criticized, and combined with recent collapses, bankruptcies, and runaways in the cryptocurrency market, regulatory agencies are increasing their oversight.
Binance, the largest cryptocurrency exchange in the world, is the target of these criticisms because of its significant investments in cryptocurrency startups. The most important reason is that Binance has not yet obtained the relevant license in the United States, so Binance established a separate Binance US to meet regulatory needs in the US market.
After all, Binance US is legal and compliant in terms of qualifications, and US regulatory agencies are mainly focusing on Binance’s other cryptocurrency investments.
As for Binance’s partners, BUSD issuer Paxos has announced that it will stop working with Binance and cease the issuance of BUSD, mainly because the SEC believes that Paxos has violated regulations. Regulatory pressure has made Changpeng Zhao feel that this will inevitably lead to failure, so there were rumors yesterday that Binance is considering severing ties with its US partners.
In response to this matter, Zhao said that Binance temporarily withdrew some potential investments or bids for bankrupt US companies. Binance will only invest and acquire bankrupt companies after obtaining regulatory approval.
For Binance, this will obviously affect its future investment scale, but at least Binance US is currently operating stably.
As for cryptocurrency licenses, Binance has not obtained licenses in most countries or regions, so regulatory agencies often require Binance to suspend operations. Binance strictly complies with these requirements and prohibits users in the affected markets from trading to avoid more serious problems.