Binance Is Reconstructing To Meet Regulatory Requirements – Will It Work?

Founded in Hong Kong in 2017, Binance has since not had a physical address. Its most crucial focus is on altcoin trading and offers crypto trading in more than 500 crypto coins. In the wake of China’s strict crypto regulations, Binance moved its headquarters to Malta.

As in any other crypto exchange platform, Binance offers trading, fundraising, listing, and withdrawing cryptocurrencies. In less than a year, Binance dominated the global crypto trade. Its market adoption does not come as a surprise to crypto enthusiasts. Its founder and CEO, Changpeng Zhao, is a renowned tech genius.

Regulatory Issues Faced by Binance

However, in recent times the crypto exchange platform has been under fire from several states. More than half a dozen nationalities have published warnings against Binance. Further, the regulators started investigations and cautioned investors against trading with the crypto exchange.

It remains unclear whether this is a coordinated state regulators’ effort or a mere domino effect. Also, global investors are on watch as to what happens with Binance. The results indicate how regulators will approach the rest of the crypto industry. Most importantly Binance crackdown affects the volatile crypto market.

Over the last few months, Binance experienced harsh scrutiny in established global economies. Banks and payment processors across Europe and the United Kingdom have subsequently cut off Binance. Many investors and users (customers) remain stranded. Notable Binance scale downs include:

Binance Seeks Europe’s Approval

U.K.’s FCA (Financial Conduct Authority) warned off Binance operations in the country. Notable British Banks such as Barclays, Santander, and Nationwide pulled Binance success. Additionally, the banks announced their review and expected a different approach to the crypto industry at large.

The EU’s Single Euro Payments temporarily cut off Binance.

Asia’s Stance on Binance’s Operations

The FSA (Financial Service Agency) stated that Binance is not registered to conduct business in Japan.

Following that, the Cayman Islands issued a notice to Binance to no longer operate within its borders. Moreover, SEC organs in Thailand filed a criminal complaint against the crypto exchange for operating in the country unlicensed.

Recently Singapore’s Monetary Authority stated that it had put Binance on a watch list.

Canada, South Africa, Netherlands and India Proves Tough for Binance’s Operations

After the Ontario Securities Commission moved on unregistered crypto exchanges, Binance pulled out of Ontario, Canada.

In a broader crypto exchange crackdown, banks in South Africa Credit card transactions for crypto. In the process, Binance checked out and in many other countries after that.

Other regulations include those in Malaysia, Netherlands, and India based on its perceived criminal activities. Regulators have launched investigations in Italy, Germany, Brazil, and Lithuania.

Among the set investigations, the U.S. Commodity Futures Trading Commission and the Department of Justice are the largest. Sections of Binance such as Bitmex have faced charges against money laundering. More regulators have moved to regulate Binance operations worldwide.

Steps Taken by Binance towards Meeting Set Regulation

Following the regulations and investigations, Binance responded to the growing scrutiny. The company plans to launch established headquarters around the world in its operational jurisdictions. Additionally, Binance has stepped up compliance capacity for high-risk products.

For example, Binance stopped crypto margin trading for some currencies. Also, it removed its tokenized stock trading feature clause. Finally, Binance limited leverage for crypto trading futures for new users. In Germany, Italy,and the Netherlands, the company wound down derivatives product offerings.

Moving on to the reconstruction process, Binance restricted derivatives access in Australia and Hong Kong. Also, Binance tightened customer verification requirements. For a new user to trade on the platform, they would have to produce a government-issued ID. Once facial verification is standardized, users can access Binance’s products and services.

The mounting scrutiny and joint global efforts for regulation standards on decentralized units are problematic. The act indicated jurisdictions arbitrage on decentralized businesses. Binance operations around the globe have had no headquarters. That moved to signal the actual state of decentralized finance.

The Future of Binance – will it work?

Binance is undergoing significant changes to meet regulatory demands. Hence the company has made regulatory compliance a top priority. The company has taken steps to hire experienced legal practitioners. The newly founded legal team offers hope to crypto enthusiasts.

Binance has plans to make fundamental changes to its business model. Its primary focus is to overhaul its current corporate structure and pick up model regulators find appropriate. However, the adopted plan goes against how cryptocurrencies were made operational. For Binance to remain relevant in many countries, the step is necessary.

Notwithstanding all the measures taken by Binance, there remains skepticism about its intentions. Regulators and investors argue that Binance is playing smart with hidden agendas. It remains questionable the extent regulators would go to crack Binance and the responses from the company.

It is tough to articulate the next phase for Binance and other cryptocurrency exchange platforms. Also, could this be the beginning of a global approach to regulating the entire crypto market? As governments around the world move for more onerous restrictions, companies are in constant need of adaptation.

A recently “Leaked Tai Chi” document exposes an elaborate Binance scheme to evade regulators. The detailed exposé details how top Binance officials plan to execute and jump U.S. regulators. The background plan details how Binance would continue operating and offering services from offshore locations.


Binance remains one of the leading crypto exchanges globally. Due to the restrictions, users have been affected. However, the detailed move ensures relevant trade across nations. To this day, the regulation clampdown continues in several countries. However, the reality of digital trade enables users with state regulations to trade through VPNs.

The future of these regulations is uncertain. Regulators need to find better ways to address anonymity. There is a need for a global strategy to address asset classes and required legal grounds in dealing with decentralized financial aspects.

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