Breaking: Binance Sells Russian Operations to CommEX, Exits Market

Key Takeaways

  1. Binance to sell its entire Russia business to CommEX
  2. Off-boarding process for existing Russian users to take up to one year
  3. Binance cites compliance strategy as the reason for exit

Binance, the world’s largest cryptocurrency exchange, has announced that it will sell its entire Russia-based operations to CommEX. Noah Perlman, Binance’s Chief Compliance Officer, stated, “As we look toward the future, we recognize that operating in Russia is not compatible with Binance’s compliance strategy.” The move comes as part of Binance’s broader focus on compliance and regulatory adherence in over 100 other countries where it continues to operate.

While Russia is tightening regulations on crypto exchanges, the U.S. is simultaneously investigating Binance for potential violations of U.S. sanctions against Russia.

On May 6, 2023, the U.S. Department of Justice’s national security division initiated an inquiry into Binance. The investigation focused on whether the exchange allowed Russian customers to access its platform in violation of U.S. sanctions, which were imposed in response to Russia’s invasion of Ukraine. This inquiry was not an isolated incident; it followed a 2021 joint investigation by the Department of Justice and the Internal Revenue Service into the global exchange. Additionally, the U.S. Securities and Exchange Commission (SEC) has been probing Binance’s relationship with two firms owned by its founder, Changpeng Zhao, since early 2022.

Earlier this year, on April 25, 2023, Binance quietly lifted restrictions it had placed on Russian citizens and residents over a year ago. These restrictions were initially imposed in March 2022 after the European Union sanctioned Russia for its invasion of Ukraine. At that time, Binance had stopped supporting deposits from Visa and Mastercard cards issued in Russia. However, by April 2023, users were able to deposit Russian rubles and other currencies from bank cards issued in Russia. The exchange also lifted limits for accounts with balances larger than 10,000 euros for users in Russia.

The European Union had broadened its sanctions last year, making it impossible for Russian citizens and residents to use any crypto service registered in the EU. This led to immediate actions from other crypto platforms like LocalBitcoins,, and, which notified Russian users that their accounts would soon be discontinued.

To facilitate a seamless transition, Binance and CommEX have outlined an orderly process for the migration of users and their assets. Existing Russian users have been assured that their assets are secure and will be protected throughout the transition period, which is expected to last up to one year. A portion of new user registrations from Russia will be immediately redirected to CommEX, scaling up over time.

While the financial terms of the deal remain undisclosed, it is noteworthy that Binance will not have any ongoing revenue split from the sale. Additionally, the company does not retain any option to buy back shares in the business, marking a complete exit from the Russian market.

Although exiting Russia, Binance remains optimistic about the growth prospects of the Web3 industry globally. The company plans to “focus our energy on the 100+ other countries in which we operate,” according to Perlman.

These regulatory pressures and policy shifts provide a broader context for understanding Binance’s decision to exit the Russian market. The sale to CommEX can be seen as a strategic move by Binance to navigate a complex and evolving regulatory landscape, both in Russia and globally.

Disclaimer & Copyright Notice: The content of this article is for informational purposes only and is not intended as financial advice. Always consult with a professional before making any financial decisions. This material is the exclusive property of Blockchain.News. Unauthorized use, duplication, or distribution without express permission is prohibited. Proper credit and direction to the original content are required for any permitted use.

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US National Security at Risk Due to China’s Dominance in Mobile Payments, says former State Department Official

Former Department of State official Anja Manuel warns that if the US loses its dominance in financial innovation and payments, it could impact its national security policy, specifically on sanctions. Manuel stated that China is catching up on dominance in mobile payments, which could make enforcing sanctions against “bad actors” like Iran or North Korea more challenging. (Read More)


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US National Security at Risk Due to China Dominance in Mobile Payments, says former State Department Official

In a Twitter Spaces discussion with Coinbase CEO Brian Armstrong and listeners, former Department of State official Anja Manuel cautioned that the US’s ability to enforce sanctions on “bad actors” like Iran or North Korea could be threatened if it fails to maintain its leadership in financial innovation and payments. According to Manuel, the US’s status as one of the largest global leaders in payments enables it to enforce sanctions on countries and entities that are deemed to be a threat to national security. However, China seems to be catching up in mobile payments, both in sophistication and scale. If China’s payments solutions gain a dominant foothold in the developing world, enforcing sanctions could become significantly more challenging.

The Office of Foreign Assets Control of the Treasury Department enforces US sanctions, including sanctions on crypto wallets related to Russian nationals and groups’ involvement in the war on Ukraine. Manuel acknowledged that sanctions generally work in a world of traditional banks and responsible blockchain firms, but they are less effective when financial technology firms are available to individuals looking to circumvent restrictions.

There are several reasons why maintaining US dominance in financial innovation and payments is essential for national security. First, the ability to enforce sanctions against countries deemed to be a threat to national security is critical. Sanctions are a key tool in deterring countries from pursuing policies that threaten US interests. Second, financial innovation and payments are critical for US economic growth. The US’s ability to innovate and create new technologies has been a key driver of economic growth for decades.

The US government has historically played a significant role in fostering innovation and supporting the growth of new technologies. However, there are concerns that the US is losing ground to other countries, particularly China. China has made significant investments in technology and innovation and has developed a reputation as a global leader in several areas, including mobile payments.

To maintain its leadership in financial innovation and payments, the US must continue to support the growth of new technologies and create an environment that fosters innovation. This will require a significant investment in research and development, as well as regulatory frameworks that support the growth of new technologies while also protecting consumers and national security.

In conclusion, the US’s ability to maintain its leadership in financial innovation and payments is critical to its national security. If the US loses ground to other countries, particularly China, enforcing sanctions and deterring countries from pursuing policies that threaten US interests could become much more challenging. The US must continue to invest in research and development and create regulatory frameworks that support innovation while also protecting national security.


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A British National Charged With Aiding North Korea in Violating US sanctions

A citizen of the United Kingdom who was wanted by the Department of Justice in the United States was apprehended by the Interpol office in Moscow (DoJ). The guy is suspected of participating in a plot to circumvent the restrictions imposed by the United States on North Korea.

Christopher Emms was taken into custody on February 21 in Moscow on the basis of a “red alert” issued by Interpol, as reported by the local media. The British national, who was 31 years old, was taken into custody at the hostel where he was sleeping.

In April 2022, it is believed that Emms, together with a citizen of Spain named Alejandro Cao De Benos, supplied North Korea with instructions on how it might utilize blockchain technology and cryptocurrencies to escape sanctions and wash dirty money. The 2019 Pyongyang Blockchain and Cryptocurrency Conference was both planned and coordinated by the two individuals.

Virgil Griffith, a person who once worked on the Ethereum project, is the third person involved in the plot. In November of 2019, he was taken into custody by the Federal Bureau of Investigation, and after entering a guilty plea, he was given a sentence of 63 months in jail. If found guilty on one count of conspiring to violate the International Emergency Economic Powers Act, Emms faces a possible maximum sentence of 20 years in jail.

Previously, Radha Stirling, the founder of Due Process International, which is a nongovernmental organization that helps defend human rights in the face of international enforcement agencies, stated that there was no strong evidence against Emms: “Precisely because he did nothing wrong; he provided no information to North Korea that doesn’t already appear on the first page of Google.”

After an eight-month travel restriction, Emms was finally free to leave Saudi Arabia in September 2022, after Saudi Arabia had rejected the American extradition request on the grounds that it had a legal foundation. He didn’t waste any time getting out of the country and went straight to Russia. However, despite the fact that the nation was the focus of the Department of Justice’s attempts to implement financial sanctions in the cryptocurrency industry, the local authorities made the decision to assist their American colleagues.


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Allegations of fraud against Compass Mining after company cuts ties with Russian

Compass Mining severed its ties with the Russian hosting provider Bit River and did not return Bitcoin mining gear to its customers. The company claimed the reason for its actions as a non-applicable sanction issued by the United States of America. Directly as a result of this, customers of Compass Mining have filed lawsuits against the company, alleging that it engaged in misleading business practises in an attempt to recoup more than two million dollars.

A document that was submitted to the court on January 17 reveals that Compass Mining informed the court in April 2022 that it had terminated its “relationships and transactions with Bit River” as a direct response to the sanctions that were issued as a consequence of Executive Order 14024. The information was revealed in the document that was filed with the court.

According to the accusations, Compass “did not offer” to return or even retrieve the assets that its clients had entrusted the firm with and which were being housed at Bit River’s facilities in Russia. These assets had been entrusted to Compass by its customers. The Russian Federation was the location of these assets.

On the other hand, it has been said that the claim that the return of the mining equipment would violate Executive Order 14024 is “false.” This order prohibits entering into deals with companies that have been blacklisted. Transactions with companies that have been placed on a blacklist are forbidden under this ruling. It was said that this directive may be the cause of the disagreement in question.

Compass has “both the right and responsibility” to ensure the return of its customers’ mines, as stated in the legal agreement between the two parties. The paper does have this stipulation as a part of it.

In an angry response to the concerns raised by clients, the management of Compass said that the company is “unable to execute or even assist” any business transactions with Bit River. This was done in response to the concerns expressed by the consumers.


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U.S. sanctions: Customers suing Compass Mining

Compass Mining severed its ties with the Russian hosting provider Bit River and did not return Bitcoin mining gear to its customers. The company cited an inapplicable fine issued by the United States of America as the reason for its actions. Bit River was the Russian hosting provider. Directly as a result of this, customers are filing lawsuits against Compass Mining for over 2 million dollars, alleging that the company took part in fraudulent operations and defrauding them of their money.

According to a document that was submitted to the court on January 17, it is stated that Compass Mining informed Bit River in April 2022 that it had terminated its “relationships and transactions with Bit River” as a direct result of the penalties that were imposed as a direct result of Executive Order 14024. These penalties were imposed as a direct result of the fact that Compass Mining informed Bit River that it had terminated its “relationships and transactions with Bit River.” This information was included in the document that was presented to the court as part of the filing process.

Compass “did not offer” to refund or even retrieve the assets that its customers entrusted the business with, which were stored at Bit River’s facilities in Russia, according to the allegations that have been made against the company. These allegations come from the lawsuits that have been filed against the company. The assets at issue were located in Russia at the time of the investigation.

On the other hand, it has been asserted that the claim that returning the mining equipment would be a violation of Executive Order 14024, which prohibits doing business with sanctioned organisations, is “wrong.” In other words, returning the mining equipment would not be a violation of Executive Order 14024. This is due to the fact that Executive Order 14024 prohibits doing business with organisations that are under punishment.

According to the legally binding agreement that was signed by all parties, Compass has “both the right and responsibility to effectuate the recovery of its customers’ mines.” This provision is included in the agreement.

The management of Compass provided an aggressive reaction to the concerns that were raised by clients by declaring that the company is “unable to execute or even facilitate” any business transactions with Bit River.


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Ethereum is Getting Closed to Being Completely Censored Because of OFAC Regulations

The percentage of OFAC-compliant Ethereum blocks being created every day has increased to 73%, which heightens censorship worries in the blockchain ecosystem.


Following Ethereum framework censorship that posits barriers to the crypto ecosystem’s goal of extremely open and accessible finance, the market has been monitoring Ethereum’s increasing adherence to guidelines set forth by OFAC. As per the development, over 73% of the blocks on the Ethereum network in the past 24 hours have been determined to enforce OFAC compliance.

Following the discovery that 51% of-Ethereum-blocks met OFAC requirements back in October 2022, top crypto media firms published an article on the growing censorship issues. But according to mevWatch data, as of November third, daily block production that complies with OFAC regulations has increased to 73%.

Meanwhile, some OFAC-mandated MEV-Boost relays would censor financial activities. Consequently, to guarantee Ethereum’s neutrality, a non-censoring MEV-Boost relay must be implemented by the network.

Additionally, by removing relays like BloXroute Max Profit, BloxRoute Ethical, Manifold, and Relayooor from their MEV-Boost configuration, Ethereum examiners can lessen their adherence to OFAC regulations.

US Government Agency Enforces Sanctions on Crypto Outlets

Based on the adherence to OFAC, the United States Government agency can apply economic and trade sanctions on crypto outlets. Meanwhile, Tornado Cash and several Ethereum addresses had already been sanctioned by the agency. Furthermore, as of the time of writing this report, 45% of all Ethereum blocks are in full adherence to the OFAC regulations. 

Following the launch of crypto exchanges by UnionBank, one of the biggest multinational banking institutions in the Philippines, in collaboration with the Swiss crypto company Metaco, the adoption of Bitcoin BTC tickers fell by $21,265 while Ethereum accelerated.

This suggests that despite the alleged censorship of the protocol, it is still widely used today.

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Binance Has Enabled Iranians Transact $8 Billion Despite Sanctions

Since 2018, crypto exchange Binance has carried out Iranian transactions worth $8 billion despite being slapped with U.S. sanctions, according to Reuters. 

Reportedly, approximately $7.8 billion has flowed between Nobitex, Iran’s largest crypto exchange, and Binance based on data availed by blockchain analytic firm Chainalysis. 


Per the report:

“Three-quarters of the Iranian funds that passed through Binance were in a relatively low-profile cryptocurrency called Tron that gives users an option to conceal their identities.”

The U.S. sanctions are meant to cut off Iran from the global financial system. Nevertheless, Nobitex has devised ways to circumvent them because it encourages its users to utilize Tron, a mid-tier token, for anonymous trading. 


Industry data indicated that Binance was the largest crypto exchange for Tron trading. Per the report:

“The total volume of Iranian transactions flowing through Binance is far greater than through any other exchange. After Binance, the next most popular exchange for Nobitex users since 2018 was Seychelles-based KuCoin, which processed $820 million in direct and indirect transactions.”

Apart from Tron, the other cryptocurrencies used in Iranian transactions included Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), Tether (USDT), and Litecoin (LTC).


The report also disclosed that crypto worth $5 billion was transacted between Binance and Iranian exchanges using intermediary layers. 


Binance has reiterated in the past that it does not aid illicit funds based on its transaction monitoring tools. Patrick Hillmann, Binance spokesperson, stated:

“Binance uses transaction monitoring and risk assessments to ensure that any illegal funds are tracked, frozen, recovered and/or returned to their rightful owner.”

Meanwhile, Ziya Sadr, an Iranian Bitcoin advocate, was recently arrested by the nation’s security forces, Blockchain.News reported.


Sadr’s arrest came amid widespread anti-government protests following the killing of a 22-year-old Iranian woman Mahsa Amini who died in police custody. Iranian authorities arrested at least 35 journalists in connection with the widespread demonstrations.

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US Treasury Imposes Sanctions on Iranian-Linked Ransomware Gang

The United States Treasury Department, through the Office of Foreign Asset Control (OFAC), has updated its sanctions list with new targets focusing on ransomware gangs affiliated with the Iranian military. 


Specifically, the OFAC sanctions list included as many as ten individuals and two companies affiliating with Iran’s hacking and cybercrime activities. According to the US Treasury, almost all of the individuals sanctioned are known to have defrauded some American entities in the past.

“This IRGC-affiliated group is known to exploit software vulnerabilities in order to carry out their ransomware activities, as well as engage in unauthorized computer access, data exfiltration, and other malicious cyber activities,” Treasury’s announcement said. 

The sanctions meted out also included 7 Bitcoin (BTC) addresses, a move that reinstates the US’s stance against using crypto by the Iranian government.

The United States Treasury Department has come under the radar recently as the regulator has intensified its enforcement actions against crypto-linked cybercriminals. Beginning with the sanctions placed on cryptocurrency mixer back in May this year on account that it was linked to the North Korean cybercriminal ring, Lazarus Group.

The Treasury Department also placed Tornado Cash on its sanctions list, claiming that as much as $7 billion has been laundered through the crypto mixer since it was created. The Tornado Cash sanctions have raised a lot of uproars as industry stakeholders faulted the Treasury Department for sanctioning a piece of code, setting an unhealthy precedent for the industry.

The regulator has been dragged to court on this matter, and the major digital currency trading platform, Coinbase Global Inc, is named as one of the entities bankrolling the lawsuit. While this is a very rare antagonism to the powers of the US treasury, the argument is a testament to the solid conviction and solidarity in the crypto ecosystem to protect some of its most ingenious privacy protocols.

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UK Requests Crypto Exchanges to Report Suspected Sanction Breaches

Cryptocurrency exchanges are now requested to report suspected sanctions breaches to UK authorities under new rules recently introduced amid concerns that cryptos are being used to evade restrictions imposed in response to Russia’s invasion of Ukraine. 

The Guardian media reported the matter on Sunday., citing the updated official guidance of HM Treasury’s Office of Financial Sanctions Implementation (OFSI) on August 30. The regulator explicitly included cryptocurrencies and other valuable digital assets like non-fungible tokens (NFTs) among those that must be frozen if sanctions are imposed on an individual or a company.

The rules set by the regulator now mean that crypto exchanges commit a criminal offence if they fail to report customers designated for sanctions.

Under the latest regulation, crypto exchanges must immediately act if they suspect that one of their clients is under sanctions or if they suspect a breach of sanctions.

The new policy has given such exchanges obligations similar to just the likes of professionals like estate agents, accountants, lawyers, and jewellers.

Financial sanctions on people and firms linked to the regime of Vladimir Putin have been among the UK’s most prominent responses to the Ukraine invasion.

Targets for sanctions have included Russian oligarchs and relatives with direct interests in crypto assets, including Vladimir Potanin, Said Gutseriev, and Oleg Deripaska, among others.

In April, Binance cryptocurrency exchange blocked the accounts of relatives of Russian politicians, including Polina Kovaleva, the stepdaughter of the foreign minister, Sergei Lavrov, Russian Foreign Minister, and Elizaveta Peskova, the daughter of Putin’s spokesperson, Dmitry Peskov.

This came as a response by the western powers led by the US, the UK, and the EU imposing unprecedented financial sanctions on Russia. During that time, fears amounted to Russian companies considering using cryptocurrency for international payments to dodge sanctions.

Using crypto to evade sanctions and move money across the globe was already illegal under UK laws. However, the new changes underline authorities’ concern that the new asset class could be used for evading sanctions because users do not depend on regulated entities to make transactions.

Whether Russia may try using cryptocurrencies to evade sanctions has been an open discussion since March this year. And decentralized finance (DeFi) and decentralized exchanges (DEX) platforms are seen as particularly vulnerable.

Cryptocurrencies have already been used to evade sanctions in Iran and North Korea.

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