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Binance Exits Russia Market As WSJ Says Crypto Exchange Faces ”Do-Or-Die Situation”

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Binance said it has exited the Russian crypto market with the sale of its business to day-old exchange CommEx.

The Russia business was ”not compatible with Binance’s compliance strategy,” said chief compliance officer Noah Perlman in a statement, adding that it will focus its ”energy on the 100+ other countries in which we operate.” It said the off-boarding of users would take up to one year to ensure a smooth transition.

“It is important to note that with this sale, Binance fully exits Russia,” it said. “Unlike similar deals from international companies in Russia, Binance will have no ongoing revenue split from the sale, nor does it maintain any option to buy back shares in the business.”

CommEx is a new exchange that officially announced its launch on Sept. 26. It said that it offers “a wide range of product suites including Spot, Futures, Simple Futures and P2P service to engage with the world of cryptocurrency.”

Binance, the world’s biggest crypto exchange, has been under legal pressure to cut ties with the country following Western sanctions imposed on Russia after its invasion of Ukraine. It’s under scrutiny by the US Justice Department for possibly facilitating transfers of money from Russia in violation of sanctions.

These investigations added to the legal burden that Binance and its CEO Changpeng Zhao have been facing. They are currently battling lawsuits by the Securities and Exchange Commission(SEC) and the Commodity Futures Trading Commission(CFTC) for various allegations including the sale of unregistered securities.

Challenges Mount for Binance

The legal challenges have hurt its US business and its market share has plunged from 75% at the end of last year to probably less than 51% this month, The Block reported. In the US market, the exchange’s US division has lost over 70% of its revenue and holds close to no market share.

A report by the Wall Street Journal says Binance is ”melting down,” and cites chief marketing offices Yi He as saying, “Every battle is a do-or-die situation, and the only thing that can defeat us is ourselves. We have won countless times, and we need to win this time as well,”

Binance has faced an exodus of top executives across the world this year and Binance.US has also laid off 30% of its employees in order to weather a slump in trading volumes.

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