In the US, Binance has witnessed a sharp decline in activity.
After the collapse of FTX, the largest exchange, Binance, seemed to dominate the cryptocurrency market at first. However, less than a year later, Binance finds itself in a risky scenario. Binance’s hegemony is wavering due to the possibility of regulatory action by US authorities. The exchange has laid off a total of 1,500 employees over the past three months in an effort to cut costs and prepare for a business downturn. More than a dozen senior managers have left the company during that time, The Wall Street Journal reports.
Kaiko, a source of cryptocurrency market data, reports that, up from about 70 percent at the start of the year, Binance currently handles about half of cryptocurrency exchanges with direct buys and sells. Due to its enormous size, Binance’s future has significant implications for the cryptocurrency sector. While experts in the field believe that other exchanges could step in to take Binance’s place if it collapses, there are concerns that in the short term, market liquidity could disappear, leading to a significant drop in token prices .
An institutional trader revealed to The Wall Street Journal that their company had backup plans in place to quickly withdraw funds from Binance in an emergency. Binance co-founder and chief marketing officer Yi He emphasized his commitment to overcome these difficulties in a message to the company’s employees last month. He emphasized that every battle is a make-or-break moment and that the only real threat is one’s own defeat.
Binance has a history of investing outside of cryptocurrency initiatives, such as X (formerly known as Twitter). Binance co-founder Changpeng Zhao, also known as CZ, is a well-known figure in the cryptocurrency community and has 8.6 million X followers.
Long-term investigation by the US Department of Justice could lead to Binance and Zhao being charged with crimes and having to pay hefty fines. The Securities and Exchange Commission (SEC) is also suing Binance, claiming it engaged in illegal activities in the US and embezzled consumer funds. The company claims that consumer money is safe and that it is committed to compliance, even as it acknowledges past mistakes, the outlet reported.
Despite its global presence, Binance’s accessibility is limited in many countries, including Europe, where more and more countries are banning its activities. In the US, Binance has witnessed a sharp decline in activity, with the recent departure of its CEO, legal head and head of risk.
