Regulators in the states of Florida and Alaska have moved to revoke the license allowing Binance.US, the exchange’s subsidiary in the United States, to continue its operations in those jurisdictions.
As reported by the Wall Street Journal on January 25, the Florida Office of Financial Regulation issued an emergency suspension order, effectively nullifying the money transmitter license previously granted to the company.
This action followed shortly after Binance founder and former CEO Changpeng Zhao pleaded guilty to charges related to allowing money laundering on the platform in November of the previous year.
Similarly, the Alaska Division of Banking and Securities has declined to renew Binance.US’s license for January 2024. While the specific reasons for this decision have not been provided, it is presumed to be linked to Zhao’s legal issues, mirroring the circumstances in the Florida case.
Subsequent to the license revocations, authorities in Florida and Alaska informed Binance that it is no longer permitted to offer services to residents of these states. Nevertheless, the platform remains operational in other US jurisdictions.
In late December 2023, regulatory agreements were reached between Binance.US and authorities in Arkansas, Illinois, and South Dakota, allowing the platform to continue its operations in those states despite Zhao’s legal troubles. However, this came with the condition that Zhao’s voting rights in the company be transferred to a third party irreversibly.
Despite the ongoing legal challenges faced by Binance, both its US subsidiary and the global platform have continued to function within the country. In a tweet dated November 28, Binance affirmed its commitment to maintaining normal operations and serving customers as usual, albeit under stringent government oversight, which may have long-term implications for its functioning.
Following his guilty plea, Changpeng Zhao encountered difficulties leaving the United States to reunite with his family in the United Arab Emirates, as the court mandated his presence in the country until his sentencing, scheduled for February 23. He faces a potential prison term of up to 18 months.