North Dakota has joined a long list of states in the United States of America to withdraw the money transmitter license of Binance.US, the U.S. arm of the global exchange. This follows after the state’s financial regulator found Binance.US on an erring side, doing business without complying with its money transmitter laws.
With this move, North Dakota emulates six other states to have revoked Binance.US’ license and becomes the seventh state to do so.
DFI Cites Reasons for License Withdrawal
According to North Dakota Department of Financial Institutions (DFI) Commissioner, Lise Kruse, BAM Trading Services, which conducts its business as Binance.US, did fail to comply with the state’s laws. In the revocation order, the regulator quoted last November’s federal conviction of Binance and founder Changpeng Zhao, which found both defendants guilty on two charges. First was the conspiracy to conduct an unlicensed money-transmitting business. Then, failure to effectively ensure the smooth running of an anti-money laundering (AML) program. The regulator claims that these are the reasons why it has decided to withdraw the license.
Kruse also recalled that Zhao, who’s a “majority beneficial owner and control person” at Binance, was recently convicted. Generally, the entire situation does not bear a good outlook for Binance.US to continue holding the license, the order suggests. An excerpt from the revocation order states:
“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.”
Binance.US to Seek Redress
Meanwhile, it might be worth noting that it is well within the rights of Binance.US to make a request to reverse the order. It has 30 days to do so. This means that the firm has until July 17, 2024, to act before the order becomes fully effective.
As earlier noted, North Dakota is one of seven states to revoke or deny BAM Trading Services the renewal of a money transmission license. Other states such as Florida, North Carolina, Maine, Oregon, and Alaska have all taken similar actions against the firm in recent months.
Florida wasted no time last November following Zhao’s guilty plea. The state immediately halted all Binance.US’ services, and became the example to others. By January, North Carolina and Maine toed the same path, revoking the license on January 23 and January 29 respectively.
Notably, Binance.US never got operational licenses in states like Vermont, Texas, New York, and Hawaii. However, even in some places where it did, the Binance.US website confirms that it is no longer onboarding new users, at least for the time being. Those places include Georgia, Connecticut, Washington, Ohio, and Minnesota.
