Binance is facing regulatory pressure

[oaktree]

https://www.ccn.com/cryptocurrency-exchange-binance-facing-regulatory-pressure-in-japan-report/

Japan’s top securities regulator will warn cryptocurrency exchange Binance that it must cease operating in the country without a license or face enforcement action.

Citing a person familiar with the matter, Nikkei reports that Japan’s Financial Services Agency (FSA) will issue a formal warning to Binance, which has allegedly begun expanding operations into Japan without permission from the regulatory agency.

Headquartered in Hong Kong and bootstrapped through an initial coin offering (ICO) last year, Binance has quickly emerged as one of the world’s most popular cryptocurrency exchanges. At present, Binance ranks as the world’s largest cryptocurrency trading platform, with a 24-hour volume of nearly $1.9 billion.

Binance has its own utility token — BNB — and the exchange operator has announced that it has begun development on its own public blockchain, which will be used as the foundation for a decentralized exchange (DEX). The BNB price fell by approximately 10 percent from its intraday high following the initial report, although its 24-hour performance is still in positive territory.

Binance has said that intends to apply for an FSA license, but the fact that it expanded its operations into this jurisdiction without regulatory approval could attract more scrutiny to the company’s application.

[richardsNY]

Binance has been growing significantly because of their soft and non caring approach to make themselves abide by the rules of each country they are operating in. It's not for nothing that it has been growing so much, and that in such a short period of time. In the same way, this concerns other exchanges as well. In most cases registering and obtaining the required licences to operate in different countries is time consuming and very costly, which is why exchanges blatantly skip it and hope to delay the process till they get asked/forced to do so, and that time for Binance has come. Crypto land is no longer the free space it once was, people should accept it....

[timerland]

Well, that's bad news for Binance for sure. Last thing you'd want as a growing exchange to have all of a sudden the country with one of the top BTC trading volumes in the entire world to tell you to cease operations.

However, I would not panic yet. Realistically I think most of the volume in Japan is probably in Bitflyer anyways, and people who use binance are more scattered over the world. There will be Japanese users that will be forced to stop using it, but I don't think it's a large percentage compared to the entire Binance customer base(correct me if I'm wrong).

Binance has been growing significantly because of their soft and non caring approach to make themselves abide by the rules of each country they are operating in. It's not for nothing that it has been growing so much, and that in such a short period of time. In the same way, this concerns other exchanges as well. In most cases registering and obtaining the required licences to operate in different countries is time consuming and very costly, which is why exchanges blatantly skip it and hope to delay the process till they get asked/forced to do so, and that time for Binance has come. Crypto land is no longer the free space it once was, people should accept it....

Absolutely. Binance is known for its soft KYC which is why it's so popular. I think sooner or later, they will be forced to comply with regulations. Just a matter of time.

[BitHodler]

I find it funny how Binance CEO is playing cool game, while he perfectly knows that he has pushed things to their absolute limit with how Binance accepts users from almost every country in the world.

It's like them just walking into someone's property, and then later just say: oh I didn't know it wasn't possible to enter without permission, sorry. In the meantime they have already gained thousands and thousands of users.

Japan has every right to act like it has done in this case. Exchanges have to accept and respect the different laws in every country. Other countries may be lagging behind with regulations, but Japan certainly not.

[orions.belt19]

Binance has been growing significantly because of their soft and non caring approach to make themselves abide by the rules of each country they are operating in. It's not for nothing that it has been growing so much, and that in such a short period of time. In the same way, this concerns other exchanges as well. In most cases registering and obtaining the required licences to operate in different countries is time consuming and very costly, which is why exchanges blatantly skip it and hope to delay the process till they get asked/forced to do so, and that time for Binance has come. Crypto land is no longer the free space it once was, people should accept it....

Well, it can be said that crypto land is no longer the safe haven people have sought out for because of the numerous regulations.

In the past few months, Binance has grown at such a fast rate because of how easy and less strict it was as compared to the other exchanges. They may have deliberately done so to attract users which have actually worked. It eventually came to a point where they had to cease the registration of new accounts. Binance may have already profited enough despite that there will be the requirement of licenses.

[Spazzer]

CZ (CEO of Binance) stated that they are indeed talks with the Japenese regulators, but nothing has been confirmed at this time. This obviously is bad news for Binance. The last thing you really want is a governance staring down at you and assessing your every move and operations. Binance is one of the biggest players in the scene with volume and their impact would be noticed.

I agree with comments above and I would not panic yet as realistically Japan has biases towards their own exchanges. The demographics of Binance are as they state international. It would really suck to loose the Japanese users, but I think Bitflyer and other exchanges will pick up the load.

[pooya87]

we are in serious need of better decentralized exchanges so that we can escape all these drama nonsense that keeps happening with these centralized exchanges. next thing you know they go bankrupt but don't say anything to the public until one day they say "we were 'hacked'" out of nowhere and run away with a lot of money...

[1Referee]

we are in serious need of better decentralized exchanges so that we can escape all these drama nonsense that keeps happening with these centralized exchanges.

Agreed. The point however is that we could have had these decentralized exchanges years ago already, but that till now didn't happen due to how low the demand is for such exchanges. It's a financial incentive based market we operate in, meaning that if something isn't rewarding enough, even when it's for a good cause, it simply won't happen.

The current decentralized exchanges perfectly demonstrate how low the demand is. In five years time of people demanding these exchanges, the actual growth of existing decentralized exchanges till now is rather disappointing. Building up such a platform takes years, which might end up costing millions, and then you have to face one or two years after operating that you won't be getting any worthy income as well. Every little thing adds up making it financially not interesting to even start. However, with LN, atomic swaps are closer to becoming reality, and this development might turn current decentralized exchanges in absolute monsters, so there is still some light/hope at the end of the tunnel.

[magneto]

https://www.ccn.com/cryptocurrency-exchange-binance-facing-regulatory-pressure-in-japan-report/

Japan’s top securities regulator will warn cryptocurrency exchange Binance that it must cease operating in the country without a license or face enforcement action.

Citing a person familiar with the matter, Nikkei reports that Japan’s Financial Services Agency (FSA) will issue a formal warning to Binance, which has allegedly begun expanding operations into Japan without permission from the regulatory agency.

Headquartered in Hong Kong and bootstrapped through an initial coin offering (ICO) last year, Binance has quickly emerged as one of the world’s most popular cryptocurrency exchanges. At present, Binance ranks as the world’s largest cryptocurrency trading platform, with a 24-hour volume of nearly $1.9 billion.

Binance has its own utility token — BNB — and the exchange operator has announced that it has begun development on its own public blockchain, which will be used as the foundation for a decentralized exchange (DEX). The BNB price fell by approximately 10 percent from its intraday high following the initial report, although its 24-hour performance is still in positive territory.

Binance has said that intends to apply for an FSA license, but the fact that it expanded its operations into this jurisdiction without regulatory approval could attract more scrutiny to the company’s application.

What will probably happen is that Binance will simply move away from the japanese markets instead of applying for a Japanese FSA license. They'll probably just disable their services for Japanese people instead of reforming their entire KYC policy or try to actually become licensed, because they want to continue to attract customers from other countries via their loose verification policies.

The problems were there at the beginning, it was just not noticed until they have gained a sizable volume. And that's the problem with all exchanges - if they operate without issues as a small exchange, they'll still probably get caught up in regulatory issues when they get bigger.

And yes, decentralised exchanges is definitely a need. Nobody trusts centralized exchanges anymore, I'd much rather prefer p2p trading even for altcoins to be honest. At least there won't be anything concerning regulations.

[LeGaulois]

Binance is supposed to move to the Malta Republic. The prime minister posted on Twitter the company is very welcome. It didn't surprise me because Malta wants to become a pioneer in Europe for the blockchain and fintech industry. It will be the 3rd country for Binance, hope to them it will be the last