In just 6 months after its debut, Binance has become the world’s largest cryptocurrency exchange. However, its journey in the US has not been easy.
As Binance entered a crucial stage of the race, the US became the most important market. Within 5 months of its launch, 1/3 of Binance’s users, equivalent to 1 million people, were from the US. However, Binance had not registered with the US Department of Treasury under the regulations of the Bank Secrecy Act.
In September 2018, the New York Attorney General’s office reported Binance’s case to the state regulatory agency after investigating whether the company provided services to US citizens. Immediately after that, Changpeng Zhao (CZ), the founder, assigned directors to find ways to maintain Binance’s operations in the US market.
In mid-2019, Binance announced that it would stop allowing US users to access its exchange platform. It was not until November of the same year that the company officially disabled access to Binance.com for US citizens. Of course, Binance did not give up on this lucrative market.
The Birth of Binance US
To continue providing services in the US, Binance partnered with BAM Trading Services to launch Binance US. The new platform operates independently of Binance and is only available to US users with significantly fewer trading pairs. In addition, Binance US does not provide derivatives platforms to avoid scrutiny from the Securities and Exchange Commission (SEC).
In fact, CZ had planned to break Binance free from the US government’s grip since 2018. The proposal was to attract the attention of regulatory agencies. Binance’s directors gradually advanced the plan, and Binance US was finally launched in 2019.
However, the start of Binance US was not very smooth either. After 3 months as CEO of Binance US, Brian Brooks, former Director of the Office of the Comptroller of the Currency, resigned due to differences in strategy. Brian Shroder, who had worked for Ant Group and Uber, was appointed CEO in September.
Notably, the relationship between Catherine Coley, the first CEO of Binance US, and the owner of Binance, was also said to be “not very good.” Under Catherine Coley’s leadership, Binance.US used low trading fees to attract US users. However, the registration process for Binance US was significantly slower because all US customers had to submit identification documents to open an account. Meanwhile, starting from August 2021, Binance Global has simplified this process by allowing users to open accounts and trade cryptocurrencies through email addresses only.
In an interview with Forbes in April 2020, Coley stated that she had no intention of expanding to other countries and that her goal was to build Binance US as a secure, reliable, and transparent platform for US users. She also expressed her hope that Binance US would become a top cryptocurrency exchange in the US market.
In conclusion, Binance’s success in the global cryptocurrency market is undeniable, but its journey in the US market has been fraught with challenges. Binance had to face regulatory hurdles, create a separate platform, and overcome leadership issues to continue operating in the US. However, with the launch of Binance US and the simplification of the registration process, Binance has shown its determination to succeed in the US market. It remains to be seen how Binance US will perform and whether it will become a major player in the US cryptocurrency market.
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