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Binance Connect, the regulated trading crypto arm of Binance, will be closing on August 16. This confirmation comes following a statement by a Binance spokesperson on August 15.
Binance Connect Closure
On the same day, Biswap, a decentralized exchange on the BNB Chain, tweeted that they had to make a difficult decision to disable Binance Connect due to the provider discontinuing their supportive card payment service. A Binance spokesperson stated:
“As Binance, we regularly review our products and services to ensure that our resources align with our long-term strategy. Over the past six years, Binance has evolved from being just an exchange to becoming a global blockchain ecosystem with multiple business lines. We continuously adapt and change our approach to meet the changing market and user needs.”
Binance Connect was launched on March 7, 2022, under the name Bifinity. The service acted as a fiat-crypto payment provider, connecting crypto companies to the traditional financial system. At its launch, the platform supported 50 cryptocurrencies, as well as fiat payment methods such as Visa and Mastercard. On the same day, the UK Financial Conduct Authority (FCA) expressed concerns over Bifinity providing $36 million convertible credit to Eqonex, a NASDAQ-listed crypto investment firm.
Binance’s Complex Situation
The FCA stated that due to the investment, some owners of Binance Group, the parent company of Bifinity, could be considered as beneficial owners of Eqonex. Binance Connect also served as a fiat-to-crypto gateway for the firm’s self-custody Trust wallet.
In the same month, Binance Australia suspended its fiat services citing an issue with a third party. In June, German regulators rejected Binance’s application for a crypto custody license. In July, the company obtained a crypto broker-dealer license from Dubai regulators. The exchange is currently facing lawsuits from both the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) for allegedly operating an unlicensed exchange in the US.
