Crypto Twitter erupted in outrage yesterday. Binance, the biggest cryptocurrency exchange in the world, halted fiat withdrawals for institutional accounts in France. The decision came without prior notice, leaving many in the sector in shock. As Binance halted withdrawals without any warning, institutions using it were left scrambling for alternative solutions. Users took to Twitter to express their frustration, with one tweet implying that the decision was careless. Hugo Manteau, the founder of QoWatt, asked CZ Binance “what do we do now?” in a tweet, adding that France needs backup solutions to help French companies in the crypto sector.
This sudden move by Binance has fueled speculation even more. Many wonder if the decision is related to recent regulatory challenges faced by Binance. Some suspect that the company is insolvent, similar to how FTX was back in Nov. 2022. The recent halt impacted not only French but also other European companies in the crypto sector. There is huge FUD around Binance right now, with influential people like Jim Cramer publicly calling out the exchange as “sketchy.” However, Binance has yet to let its users down. Even after the exchange fell prey to a cyberattack back in 2019, it fully refunded the victims’ assets.
In response to the withdrawal halt, Binance’s CEO, CZ Binance, has yet to offer an explanation. The lack of communication from Binance’s leadership only adds to the mounting frustration among its French institutional users.
Binance Under Fire From U.S. Regulatory Bodies
Binance’s issues with US regulatory bodies have made headlines recently. The cryptocurrency exchange has been under scrutiny by the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). These bodies are investigating Binance’s compliance with insider trading and security regulations.
Adding to Binance’s issues, a Financial Times report exposed some of the company’s secret ties to China. The report suggests that Binance has been secretly working with employees in China. Additionally, according to FT, Binance advised its employees there to use virtual private networks (VPNs) to hide their location. The investigation was fueled by CZ Binance’s claims that Binance has no headquarters and works in a decentralized manner. While this may be true, the company has to abide by the rules. The release of this report has fueled further concerns about Binance’s future.
As the story unfolds, many are closely watching Binance’s next steps. The company’s ability to maneuver through these accusations and regulatory challenges will be crucial for its future. Binance is the biggest company in the crypto industry, and its failure could be catastrophic for the industry, Bitcoin in specific.