Major Ukrainian crypto-exchanges refuse to trade their own Binance token – BNB, and the state is urged to end any cooperation with the company. All because of Binance’s ties with Russia and Iran, despite the sanctions against these two countries.
Binance VS Mindigiti
On November 9, Binance announced the expansion of cooperation with the Ministry of Digital Transformation of Ukraine and the possible launch of cryptocurrency settlement for government services.
Cryptocurrency exchange Binance and the Ministry of Digitization are working on the possibility of integrating payment in cryptocurrencies using Binance Pay for government services, in particular in “Dia”. The general manager told ForkLog UA about this @BinanceUkraine Kyrylo Khomyakov. https://t.co/gemuaXlH1M
— ForkLog UA (@ForklogUA) November 8, 2022
The organizations have already collaborated before: in September, Binance added verification through Diyu for new users. Also, as part of the IT Generation project, at the end of June, the Ministry of Digital Development and Binance began accepting applications for free training in IT specialties, and in August the number of places under the program was increased from 1000 to 1830. As part of the partnership, Binance Charity allocates $ 1 million in BUSD for scholarships.
Master a popular programming language to earn from $1300 a year
Currently, partners have also announced the expansion of the subject of educational projects to Web3, blockchain and cryptocurrencies.
It would seem that the news is not bad, but there is a “but”. Binance has long been trying to “bring to life”, pointing to its obscure ties with Russia and Iran, which continues to supply weapons to the aggressor. So the announcement of the further cooperation of the crypto exchange with state organizations of Ukraine further angered the representatives of the local crypto community, who began to boycott Binance.
Boycott crypto exchange
BlockSoftLab CEO Vadim Grusha created a petition to the President of Ukraine Volodymyr Zelensky demanding to “block the integration of Binance in the Mintsifra application.” The appeal is still being moderated, but Forbes journalists partially published its contents:
“Dear Mr. President, I ask you to block any actions to integrate Binance solutions into Diy. Binance is a member of the association of Russian banks and “serves hundreds of millions of dollars worth of Russians every day.”
The author of the petition proposes to block the operation of the company in Ukraine until Binance fulfills the conditions of international sanctions regarding Iran and cuts off its ties with Russia.
Grusha himself has already canceled trading of BNB (Binance’s own token) in the Trustee Plus crypto bank created by BlockSoftLab. The businessman claims that the business will lose about 6% of income from this, the rejection of the ruble at the beginning of a full-scale invasion of Russia cost more – about 60% of revenue.
The oldest Ukrainian exchange Kuna also closed BNB trading and blocked the possibility of depositing funds from November 9th. And yesterday, WhiteBIT joined the boycott, officially announcing the withdrawal of Binance tokens from the exchange:
“We are starting the process of removing Binance Coin (BNB) from the exchange. Access to replenishment is already closed. Trading on all BNB pairs will close on November 11 at 12 UTC. Withdrawal access will be closed on November 17 at 12 UTC. All BNB holders will receive details and instructions via email.”
“Dangerous” Links Binance
Binance has processed $7.8 billion worth of Iranian transactions since 2018, in defiance of U.S. sanctions aimed at shutting Iran off from the global financial system. The scale and duration of Iranian crypto flows came to light amid a US Department of Justice investigation into money laundering of Binance (which dominates the $1 trillion crypto industry with over 120 million users).
Iran supplies weapons to Russia – Binance also continues business relations with the aggressor country.
According to Bloomberg sources, Russia was one of the top five Binance markets in the world with a total of about 10 million accounts. At the beginning of the full-scale invasion, CEO Changpeng Zhao of Binance said that the crypto exchange complied with the initial orders of the international government to limit those under sanctions, but said that further expansion would be “unethical.”
In April 2022, the fifth package of European sanctions was announced, after which Binance limited the withdrawal of funds from its services for Russians (in particular, those with assets worth more than €10,000). Bloomberg sources estimate that fewer than 50,000 people actually have accounts above that amount.
The eighth, tougher package of EU sanctions was adopted in October and included a ban on providing Russians with crypto wallet services, accounts or crypto assets storage services, regardless of the amount of assets.
According to Forbes, there are currently 18 ruble trading pairs and I/O gateways available on Binance to easily bypass sanctions.
What threatens Binance
This week has been a tumultuous one for the crypto exchange. Binance was initially going to rescue Sam Benkman-Fried’s FTX, which was facing a liquidity crisis. The owners even signed a non-binding “letter of intent”, but Zhao changed his mind about implementing the agreement after reading the FTX documentation.
Bloomberg writes that FTX management is facing a “financial black hole” – a gap between liabilities and assets in the crypto exchange, which, according to the sources of the publication, is probably more than $6 billion.
As a result of corporate due diligence, as well as the latest news reports regarding mishandled customer funds and alleged US agency investigations, we have decided that we will not pursue the potential acquisition of https://t.co/FQ3MIG381f.
— Binance (@binance) November 9, 2022
At the same time, Bitcoin fell 9.9% to $16,853, bringing it down to nearly 20% this week.
Experts interviewed by Forbes reporters say the boycott is more of a “manifestation of a political position” than an attempt to put pressure on businesses.
“In my opinion, Binance will not feel this in the overall turnover,” says Dmitry Malyukov, CEO of the CrossPay crypto processing service.
The founder of the first cryptocurrency exchange KUNA in Ukraine, Mikhail Chobanyan, does not hide the political subtext and calls on the exchange to choose one side.
“Binance needs to decide whether it operates in Russia and Iran or operates in Ukraine,” he says.
Mintsifra promises to make an official statement on November 14.