It sounded a bit too good to be true that Binance, the world’s largest crypto exchange, was pushing hard to launch its US subsidiary, Binance.US, in order to accommodate its US clients that had recently been denied trading status, due to regulatory concerns. It had just begun its KYC registration process and was taking deposits this week, when out of the blue it announced that it, unfortunately, had to block clients in 13 states, until it had completed the necessary regulatory compliance protocols.
Binance.US CEO Catherine Cooley stated that her exchange will continue to press hard to get all US citizens on its platform: “Although it is upsetting that we cannot offer Binance.US in the states where I grew up and earned my education at this time, please rest assured that this is just the beginning, and it is our mission to bring access to those of you in these states many of us call home… U.S. customers will be able to buy listed coins with USD through ACH or wire transfer methods. We will be exploring other options based on the demand of our users.”
The states impacted were Alabama, Alaska. Connecticut, Florida, Georgia, Hawaii, Idaho, Louisiana, New York, North Carolina, Texas, Vermont, and Washington. As for qualifying states, customers will not be able to access many of the features and over 100+ “crypto/crypto” pairings that are offered and supported on the international Binance platform. US clients will be able to buy and trade with “six supported cryptocurrencies, including Bitcoin, Ethereum, XRP, Bitcoin Cash, Litecoin, and Tether”, with more tokens to come in the future, based on regulatory guidelines and restrictions.
The company did offer some accommodation for customers with other non-supported tokens. Cooley emphasized that: “The platform plans to steadily add more coins after its initial launch”. She then added that: “All coins/tokens not yet listed on Binance.US can still be stored with other custodians in the custody method of your choice (ex. hot wallet, cold storage, etc.) and traded on other venues that have live order books in those pairs. Over the coming weeks, we will be adding coins that satisfy our Digital Asset Risk Assessment Framework.”
Retail traders are uncertain as to how the future might roll out related to Binance.US. It is not Binance. It will be operated by BAM Trading Services, a separate local entity, which will have licenses to run Binance software. Will there be a “culture transfer” of high ethical standards, security, reputation beyond reproach, and customer support that is focused on client needs? Will there be a mass migration to other exchanges? Will Binance.US succeed in a very highly competitive marketplace?
These questions can only be open to speculation at this time. Binance has established itself as one of the finest organizations in Crypto-Land, but these changes have arisen quickly, with unforeseen bumps along the way. What if you to want to switch your exchange provider?
Coinbase and Kraken are the obvious choices in the U.S. market, but neither supports a broad listing of tokens like Binance International. Other analysts and traders have also suggested Bittrex, a US-based exchange that does offer 200+ tokens, and KuCoin, based out of Hong Kong and offering 300+ tokens. Perform your own due diligence before jumping, if you think a switch is a real consideration.