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Binance Connect to Cease Operations on August 16 – What’s Going On?

Hassan Shittu
Last updated: | 2 min read
Source: Adobe / prima91

As confirmed via email from a Binance spokesperson on August 15, Binance Connect, the regulated buy-and-sell crypto arm of the Binance exchange, will shut down on August 16.

The same day, the decentralized BNB Chain exchange known as Biswap posted a tweet announcing that Binance, a major cryptocurrency exchange, had arrived at a challenging decision.

“After a thorough consideration, @binance has made a difficult decision to disable @Binance_Connect on August 15 due to its provider closing the supporting card payments service.” 

The move was undertaken in line with Binance’s strategic initiatives, which prioritize the concentration on its fundamental business activities.

The email received by Cointelegraph from a Binance spokesperson highlighted the company’s proactive approach to maintaining its operational efficiency and strategic alignment. 

The email stated, “At Binance, we periodically review our products and services to ensure that our resources remain focused on core efforts that align with our long-term strategy. In the last six years, Binance has grown from an exchange to a global blockchain ecosystem with multiple business lines. We consistently adapt and modify our business approach to changing market and user needs.”

This statement underscores Binance’s commitment to remaining at the forefront of the rapidly evolving blockchain and cryptocurrency landscape. 

The company’s recognition of its transformation from a mere exchange to a comprehensive blockchain ecosystem demonstrates its responsiveness to industry dynamics and user preferences.

 As the cryptocurrency market continues to witness fluctuations and emerging trends, Binance’s approach of flexible adaptation ensures that its services remain relevant and impactful for its global user base.

Bifinity’s Transformation: Launching Binance Connect, Partnering with Eqonex, and Navigating Regulatory Implications

On March 7, 2022, Bifinity, later known as Binance Connect, was launched as a fiat-to-crypto payments provider linking crypto businesses with traditional finance.

The platform supported 50 cryptocurrencies and accepted fiat payments through Visa and Mastercard. 

Bifinity partnered with crypto firms like Eqonex, a Nasdaq-listed digital asset investment company, to bridge the gap between crypto and traditional finance.

The same day, Bifinity formed a strategic alliance with Eqonex, involving a $36 million convertible loan to expand their products, including Eqonex’s crypto custody solution Digivault.

The UK’s Financial Conduct Authority (FCA) stated that due to this investment, certain holders of Binance Group, Bifinity’s parent company, which lacks UK regulation, might be deemed beneficiaries of Eqonex. 

While Binance has faced various challenges recently, it’s important to note that these are not the only issues the company has encountered. 

In the same month, Binance Australia temporarily suspended its fiat services, attributing the action to a problem involving a third-party entity.

Subsequently, in June, Binance faced a setback when German regulators turned down its application for a crypto custody license.

However, July brought a positive development as the company managed to secure a crypto broker-dealer license from regulatory authorities in Dubai.

It’s worth highlighting that Binance’s legal battles have added another layer of complexity to its situation. 

Currently, the exchange is entangled in legal disputes with the US Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). These regulatory bodies have alleged that Binance operates an unlicensed exchange within the United States. 

This legal strife has undoubtedly contributed to the challenges and uncertainties currently surrounding the company.