Binance Retreats From U.S. After Illegal Fund Transfer Is Exposed

Binance has pulled back on some potential investments in the United States, its CEO Changpeng Zhao said, following a Bloomberg report that the major crypto exchange was considering ending relationships with US business partners, Jaiver Shekhawat and Niket Nishant reported for Reuters.

Photo Insert: Binance has insisted on its legitimacy, even sponsoring workshops on tackling crypto-related crimes.

"We pulled back on some potential investments, or bids on bankrupt companies in the US for now. Seek permission first," Zhao wrote in a tweet, without elaborating.

The Bloomberg report said Binance is considering ending business relationships with banks and services firms in the US, amid heightened regulatory scrutiny of the company, largely spurred by a series of investigative reports by Reuters.

Binance is also reassessing US venture capital investments and will consider de-listing tokens from any US-based projects, including the major stablecoin USD Coin, the report said.

Word that Binance may drop its US partners comes a day after Reuters reported that the global Binance exchange, which is not licensed to operate in the US, had secretly moved more than $400 million from accounts held by its purportedly independent US partner.

The money, the company said, was shifted to a trading firm managed by Binance CEO Zhao.

"Like every other blockchain company, we are conducting a careful cost-benefit analysis and will pivot our business as necessary to protect our global user base," a Binance spokesperson said. US regulators have stepped up scrutiny of crypto companies this year.

The action comes after meltdowns in the crypto sector last year saw a string of major industry players in the US and beyond collapse. On Monday, New York's top financial regulator ordered the firm behind Binance's stablecoin to stop issuing the token.

Earlier, Binance said it had suspended all dollar bank transfers after a US banking partner, Signature Bank, dialed back exposure to crypto firms.

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