North Dakota Department of Financial Institutions (DFI) has revoked Binance.US’s money transmitter license due to non-compliance issues.
North Dakota has become the latest U.S. state to revoke Binance.US’s money transmitter license, marking the seventh state to take such action. On June 17, 2024, the North Dakota Department of Financial Institutions (DFI) announced that BAM Trading Services, operating as Binance.US, had failed to comply with the state’s money transmitter laws. This decision shows a growing trend of regulatory scrutiny on Binance.US across the country.
Binance.US Failure to Meet Compliance Standards
DFI Commissioner Lise Kruse stated that Binance.US did not meet the requirements to keep its license. The revocation order cited a federal conviction of Binance and its founder, Changpeng Zhao, for running an unlicensed money-transmitting business. Zhao’s felony conviction for violating federal anti-money laundering laws was a key factor in this decision.
“The Commissioner finds the Respondent does not continue to meet the qualifications or satisfy requirements that may apply to an applicant for a new money transmitter license,” the order stated. Binance.US has until July 17, 2024, to request a reversal of the order. If no request is made, the revocation takes effect immediately.
North Dakota joins states like Alaska, Florida, Maine, North Carolina, and Oregon which have all revoked or denied the renewal of money transmission licenses for Binance.US recently. Florida was the first state to act in November 2023 following Zhao’s guilty plea. North Carolina and Maine followed in January 2024.
Despite these revocations, Binance.US has never received licenses in states like New York, Texas, Vermont, and Hawaii. Additionally, new user onboarding has been temporarily paused in Connecticut, Georgia, Ohio, Minnesota, and Washington state, according to the Binance.US website.
Impact on Binance.US Operations
The growing number of states revoking or denying licenses to Binance.US reflects a tightening regulatory environment for cryptocurrency exchanges in the United States. These actions come amid increasing scrutiny on the practices of crypto companies, particularly regarding compliance with anti-money laundering regulations and other financial laws.
Binance.US’s ability to operate within the United States is becoming increasingly restricted, which could impact its user base and market operations. The company’s compliance with regulatory standards will be critical in determining its future in the US market.
The regulatory measures against Binance.US signal a broader trend of increased oversight in the cryptocurrency sector, aiming to ensure that exchanges adhere to stringent legal standards. As more states join this regulatory crackdown, the landscape for crypto exchanges in the US continues to evolve, highlighting the importance of compliance and transparency in the industry.
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