In a bid to reconnect to the traditional FIAT banking system, Binance.US, the U.S. subsidiary of the crypto exchange, has entered into a partnership with MoonPay, a startup specializing in payments. The troubles for Binance.US have been mounting, with several banking partners severing ties, causing disruption in deposit and withdrawal of dollars. The collaboration with MoonPay offers Binance.US users an alternative route to convert dollars into cryptocurrency.
Binance.US had to suspend dollar deposits after losing ties with various banking partners, following legal action by the U.S. Securities and Exchange Commission (SEC) on allegations that it was operating an unregistered securities exchange.
MoonPay, recognized for its notable collaborations centered around nonfungible tokens (NFTs), now enables Binance.US customers to employ their debit or credit cards, Apple Pay, or Google Pay for purchasing USDT. Subsequently, this stablecoin can be utilized to acquire other available crypto tokens on the platform. Immediate access to the MoonPay option has already been granted to customers.
MoonPay‘s CEO, Ivan Soto-Wright, underscored the company’s strict adherence to regulatory guidelines and emphasized its execution of know-your-customer compliance checks for Binance.US users. This strategic move transpires amidst legal action faced by Binance.US from the U.S. Securities and Exchange Commission (SEC), which filed a lawsuit against the exchange and its global affiliate, Binance.com, for alleged securities law violations. Following the lawsuit, Binance.US witnessed a decline in market share and liquidity, diminishing its standing relative to U.S. counterparts Coinbase Global Inc. and Kraken.
Amid the last crypto hype in 2021, MoonPay has secured $555 million in funding, boasting endorsements from prominent figures such as Ashton Kutcher and Justin Bieber.
Pivotal Changes Ahead
The crypto industry at large confronts a pivotal challenge, with global regulators intensifying scrutiny of crypto firms. The SEC’s accusations against Binance and its founder, Changpeng Zhao, encompass illegal service to U.S. customers, improper control over client assets, and disregard for compliance and anti-money laundering standards. Binance has also received a lawsuit from the Commodity Futures Trading Commission (CFTC), alleging violation of the Commodity Exchange Act.
The ongoing legal entanglements faced by Binance and other players in the crypto space underscore the industry’s quest for identity. While the industry’s image as a lawless realm of digital innovation attracted enthusiasts, regulatory bodies are now tightening the reins on questionable practices.
