Binance Connect, the regulated buy-and-sell crypto arm of Binance exchange, is set to shut down on August 16.
This announcement comes after the decentralized exchange Biswap tweeted on the same day, revealing that Binance had made a challenging decision to disable its crypto arm on August 15 due to the closure of its supporting card payments service.
Biswap’s Tweet Reveals Binance Connect’s Closure
Initially launched as Bfinity on March 7, 2022, Binance Connect aimed to bridge the gap between traditional finance and the world of cryptocurrencies.
It served as a fiat-to-crypto payments provider, facilitating connections between crypto firms and the conventional financial system. The platform’s launch boasted support for an array of 50 cryptocurrencies and included popular fiat payment methods like Visa and Mastercard.
However, the decision to shut down Binance Connect has sent shockwaves throughout the industry, raising concerns and prompting speculation about the underlying reasons behind this sudden closure.
With the termination of the supporting card payments service, Binance Connect encountered a significant setback, leading to the unfortunate but inevitable decision to cease its operations.
The closure of Binance Connect not only affects the exchange itself but also has implications for crypto investors and businesses that relied on the platform for their fiat-to-crypto transactions.
As the crypto space continues to evolve, regulatory pressures and the need for enhanced security measures have become paramount.
The decision to shut down Binance Connect underscores the growing importance of a regulatory framework.
With the closure of Binance Connect, industry players are left contemplating the future of decentralized finance (DeFi) and the potential for innovative solutions to bridge the gap between traditional financial systems and the crypto ecosystem.
Binance Seeks Protective Order Against SEC
According to a Reuters report, Binance has filed for a protective court order against the U.S. Securities and Exchange Commission (SEC), alleging that the regulator’s requests for information are excessively broad and unduly burdensome.
In a court filing submitted to the U.S. District Court of Columbia, Binance’s operating company BAM Trading and BAM Management argued that they have already provided the SEC with ample information.
The protective order seeks to restrict the SEC’s actions, including limiting the number of depositions from BAM employees to four and excluding the depositions of BAM’s CEO and CFO, without specifying individuals by name.
The legal action stems from the SEC’s lawsuit against Binance and its CEO, Changpeng Zhao, filed in June.
The regulatory body leveled 13 charges against the company, including allegations of operating a “web of deception.”
These charges include claims of artificially inflating trading volumes, misdirecting customer funds, failing to restrict U.S. customers from accessing the platform, and misleading investors regarding market surveillance controls.
In their court filing, the firm emphasized that the SEC has yet to present any evidence indicating misuse or dissipation of customer assets. The company seeks to challenge the SEC’s requests, as well as its resistance to accepting proposed limitations in the information it demands.
As the case unfolds, industry observers will closely watch the developments and their potential impact on both the exchange and the wider crypto market.
The outcome may shape future interactions between regulatory bodies and cryptocurrency exchanges, influencing how compliance, information sharing, and investigations are conducted within the industry.
Featured image from iStock, chart from TradingView.com