Changpeng Zhao (CZ), the CEO of Binance Exchange has responded to reports making the rounds that the leading cryptocurrency trading platform plans to sever ties with US-based Web3.0 projects.
According to a February 17 Twitter thread from the Binance CEO, he described the February 17 publication from Bloomberg which suggests that his exchange will delist US-based tokens as the regulators continue to beam their searchlight on the industry as false, adding that “blockchain has no borders.”
In the said publication, Binance is considering delisting tokens owned by US-based projects including USD Coin issued by rival platform Circle since the exchange and some of its partners have been the subject of intense scrutiny by regulators in the country.
Recall that Binance’s partner and stablecoin issuer Paxos is being investigated by US regulators including the United States Securities and Exchange Commissions (SEC). Likewise, the New York State Department of Financial Services (NYDFS) could face enforcement action for allegedly offering unregistered securities in form of Binance USD (BSUD).
Interestingly, pressure from the regulators has resulted in $2.3 billion in the redemption of the BUSD tokens in a few days. Binance exchange has now minted $50 million worth of TrueUSD (TUSD) from the smart contract of the TrustToken platform after regulators ordered Paxos to stop minting BUSD tokens.
Binance Slows Engagement in the US
Although CZ has categorized the report as false, he tweeted that the exchange will review other projects from jurisdictions with regulatory uncertainties to protect users from undue harm. The firm also pulled the plug on potential investments or acquisitions of bankrupt crypto firms in the US due to regulatory concerns.
Due to the regulatory crackdown, Binance, which already provides support for a number of stablecoins including USDT, is already exploring other options for stablecoins for its platform. The exchange is planning on exiting the use of BUSD as the central pair for trading on its platform. There are also possibilities to explore Japanese and Euro-based stablecoins.
Meanwhile, there are concerns that the continuous pressure from regulators may lead to a decline in the popularity of stablecoins pegged to the US dollar and the pursuit of many crypto projects offshore.