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Binance, the world’s largest cryptocurrency exchange, has made the decision to exit the Russian market due to compliance concerns. The exchange has agreed to sell its entire Russian business to CommEx, a newly launched crypto exchange.
CommEx, which officially launched on September 26, aims to provide a range of cryptocurrency trading services, including spot, futures, and peer-to-peer trading. It primarily targets Russian users, as its interface is available in Russian and English.
Earlier this year, reports surfaced suggesting that Binance was under investigation by the Department of Justice regarding whether Russian customers were able to access the exchange in violation of US sanctions related to Russia’s actions in Ukraine. As a response, Binance had already cut ties with sanctioned Russian banks in August.
With this move, Binance is fully withdrawing from the Russian market, planning to phase out all exchange services and business operations in Russia over the next several months.
The financial terms of the deal remain undisclosed, but there will be no ongoing revenue sharing or options for Binance to repurchase shares in the business.
CommEx welcomed its “new users from Russia and around the world” on its social media account.
To ensure a smooth transition for existing Russian users, Binance will facilitate the off-boarding process over the course of a year. The exchange also assured that the assets of its Russian users are safe and securely protected.
Binance’s chief compliance officer, Noah Perlman, explained the decision: “As we look toward the future, we recognize that operating in Russia is not compatible with Binance’s compliance strategy. We remain confident in the long-term growth of the Web3 industry around the world and will focus our energy on the 100+ other countries in which we operate.”
It’s worth noting that, unlike other international companies, Binance’s exit from Russia does not involve any ongoing revenue sharing or options for reacquiring shares in the business.
Binance will work closely with CommEx to ensure a seamless user migration process and will provide instructions to users on how to transfer their assets to the newly created exchange.
Furthermore, Binance’s CEO, Changpenz Zhao (CZ), announced that holders of Binance’s native token, BNB, will continue to enjoy a 25% trading discount on CommEx.
Russia has been one of Binance’s significant markets, with a substantial number of user visits to the Binance.com website originating from Russia, making it a key market for the exchange.
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