In a significant move reflecting efforts to adhere to international financial sanctions, Binance has dropped Banco de Venezuela from its peer-to-peer (P2P) trading services. This action comes in the wake of similar steps taken against sanctioned Russian banks last week.
Formerly holding the third spot with over 11% market share, Banco de Venezuela was acquired by the Venezuelan government in 2009 after being sold by the Spanish Bank Santander for approximately USD $1 billion.
Binance Navigates Regulatory Complexities
However, sanctions were imposed on Venezuelan government officials and affiliated institutions by the US Treasury Department in 2019 for allegations of corruption. While Banco de Venezuela’s removal from Binance’s P2P has raised concerns in the nation, other private Venezuelan banks like Banesco, Banplus, and BBVA Provincial remain available for P2P crypto trading.
The recent attention to including sanctioned financial institutions as payment options on cryptocurrency platforms started when Tinkoff Bank and Rosbank appeared on Binance as transfer methods. However, following a recent report by the Wall Street Journal, these options were swiftly removed by the exchange. The affected banks have faced sanctions due to Russia’s involvement in the Ukraine conflict.
Despite the claims made against Binance, the exchange denied any involvement with sanctioned banks in connection with its P2P program. A spokesperson from the exchange stated that Binance does not have any affiliation with any banks, whether Russia or any other location, for its P2P services.
Broader Regulatory Context
Following Binance’s move, other crypto exchanges like OKX and Bybit excluded sanctioned Russian banks from their payment options. ByBit and OKX had allowed Russians to use cards issued by the sanctioned banks for cryptocurrency purchases through their P2P platforms. Similar to Binance, these exchanges have ceased such offerings with the Russian banks, according to a report by Finance Magnates.
Binance’s actions occurred at a time when regulatory attention on the exchange has heightened on a global scale. The platform is currently facing legal action in the US from both the Securities and Exchange Commission (SEC) and the Commodities Futures Trading Commission (CFTC).
Yesterday (Monday), reports emerged that Binance had decided to migrate its users in Belgium to its Polish subsidiary, Binance Poland. This decision was made after the Belgian financial market watchdog ordered Binance to cease its cryptocurrency exchange and custody services in the country, citing concerns over serving users outside the European Economic Area (EEA).
This article was written by Jared Kirui at www.financemagnates.com.
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