Key takeaways:
- Binance is thinking about taking legal action against Checkout.com.
- A Binance official explained that on-ramp and off-ramp services are still available at the exchange.
The cryptocurrency exchange Binance is debating taking legal action against Checkout.com, its previous payment processor. The letters that Checkout.com and Binance exchanged on August 9 and August 11 resulted in a prospective legal issue.
Guillaume Pousaz, CEO of Checkout.com, reportedly severed ties with Binance due to “reports of regulators’ actions and orders in relevant jurisdictions,” as well as worries about anti-money laundering measures, sanctions, and compliance measures, according to a Forbes report.
A Binance official explained in an email that on-ramp and off-ramp services are still available at the exchange:
“We do not agree with Checkout’s purported basis for termination and are considering our options for legal action,”
However, the crypto exchange shut down Binance Connect, a licensed crypto buy-and-sell activity, on August 16 due to the terminated commercial partnership. The platform, introduced in March 2022, acted as a fiat-to-crypto payment provider, connecting crypto companies with the established financial system by supporting over 50 cryptocurrencies and fiat transactions.
Forbes claims that in 2021, Binance was Checkout.com’s top customer, moving almost $2 billion in transactions in a single month.
Over the past few months, Binance’s operations have been debanking, which has made it difficult for several of its international subsidiaries to obtain partners. The exchange said in June that Paysafe Payment Solutions, a partner in euro banking, would stop providing service in Europe.
Its local branch in Australia was abruptly cut off from the banking system in June without prior notice or discussion. According to reports, Binance US in the United States had trouble obtaining banking partners, and its previous partners, Silvergate and Signature Bank, were shut down earlier this year during the banking crisis.
According to Changpeng Zhao, CEO of Binance, the current crisis has even caused him to think about purchasing a bank.
Business and legal issues for Binance seem to be far from resolved. The US Securities and Exchange Commission (SEC) filed a lawsuit against the international exchange and its CEO on June 5 in response to claims that they had broken the country’s securities laws by marketing unregistered securities.
