The world’s number one cryptocurrency exchange by volume, Binance, is yet again cracking down on users in the United States who continue to access the popular trading platform from regions where the company doesn’t have the regulatory stand to operate. The exchange has recently sent email notifications to these users, giving them 14 days to close their accounts.
“Dear user, as we constantly perform periodic sweeps of our existing controls, we noted that you are trying to access Binance while having identified yourself as a US person,” the email states.
This isn’t the first time the exchange has warned customers in the US, but this time the email looks much more firm with its language on the matter. Back in 2019, the exchange gave its customers 90 days to provide evidence that they did not violate its terms of service, or they might lose access to the ability to trade and deposit assets.
However, tech-savvy users had been ignoring these warnings because Binance partially relied on information provided by its customers, and customers were able to claim that they were not American when opening an account.
Binance had employed a tiered verification system that enabled users to trade/withdraw limited amounts of Bitcoin via the spot market without having to go through the strict Know-Your-Customer verification requirements that are present on any US-based trading platform. As a result, those who lied about their nationality were able to continue to use the exchange’s services.
The report comes weeks after it was reported that Binance was sending emails to users with U.S.-associated IP addresses. Anyone who logged in from the U.S. was given 90 days to switch to Binance U.S.
However, since Binance U.S. featured fewer assets compared to its global platform, American users continued to bypass these restrictions using a Virtual Private Network.
Strict measures during difficult times?
The recent warnings come right after an October 29 article from Forbes writer Michael Del Castillo alleged that Binance Holdings Limited devised a major plan to deceive the regulators in the US and avoid regulatory scrutiny while continuing to profit from the US market.
The article further stated, “All the while, potential customers would be taught how to evade geographic restrictions while technological workarounds were put in place.”However, Binance has denied these allegations and has filed a lawsuit in the state of New Jersey against Forbes Media and two of its Journalists Michael del Castillo and Jason Brett, who authored the article.