The upcoming week, Binance Blockchain Week, is planned to be held in Istanbul, Turkey. The new Director of Marketing, Rachel Conlan, describes Turkey as a crypto-friendly country with a dynamic ecosystem for any industry. Bitcoin is the most popular cryptocurrency in Turkey, accounting for 71% of all crypto assets.
Timeline of Events
We all know that due to the Russian invasion of Ukraine on February 24, 2022, many platforms exited Russia, including well-known ones like Blockchain.com, WhiteBIT, Coinbase, and Dapper.
However, unlike others, Binance allowed Russians to withdraw money abroad, potentially leading to legal consequences for the company in the United States, as The Wall Street Journal reported.
Binance introduced some restrictions for Russians. The exchange excluded users with assets exceeding 10,000 euros from trading. Russian users were not allowed to trade on the exchange or deposit additional funds into their accounts. The only available function for such clients was fund withdrawal, according to the exchange’s statement.
Dutch users were informed that they could no longer use the exchange and were strongly recommended to switch to the newly created exchange, CommEX.
In August-September, rumors began circulating about Binance’s complete withdrawal from the Russian market, leading many users to seek alternatives. Much to their surprise, many Russian users switched to CommEX, a relatively unknown exchange, sparking speculation.
27th of September 2023
Binance, one of the world’s largest cryptocurrency exchanges announced its departure from the Russian market and transferred all its assets to CommEX, a recently launched cryptocurrency exchange. The crypto giant stated that it had agreed to sell its Russian business to CommEX, without disclosing the financial details of the deal.
‘Operating in Russia is not in line with Binance’s compliance strategy.’
Binance’s founder and CEO, Changpeng Zhao, announced on his Twitter account that some former members of Binance’s cryptography and information security teams may join CommEX.
Furthermore, Zhao responded to a common question from users regarding the similarity of the user interfaces of the two cryptocurrency exchanges and emphasized that Binance intentionally wanted them to be that way, as stated in CZ’s tweet.
Some answers about Binance/CommEx.
There will be crypto transfers between Binance & CommEx as users migrate with their funds. There are also older transactions during the testing phase of the integrations. This is expected.
A few ex-Binance CIS team members may join their team,…
— CZ 🔶 Binance (@cz_binance) September 28, 2023
Despite Zhao’s statement, the cryptocurrency community continues to seek answers to many questions regarding CommEX. While no information about who owns or manages the cryptocurrency exchange is provided, there is no specific information on these matters, except that any legal disputes will be resolved in Hong Kong. Although Binance denies allegations that the cryptocurrency exchange is its shadow owner, it also denies that CommEX uses the same underlying technology.
Although CommEX defines itself as a rapidly expanding cryptocurrency exchange supported by top-level cryptocurrency venture funds on its information page on the Binance CoinMarketCap data and price platform, the names of these cryptocurrency venture capitalists are not disclosed.
Questions about CommEX
There are several questions and some uncertainty surrounding CommEX as the exchange does not disclose information about its ownership and management. The only provided contact information is an email address, and inquiries about ownership have gone unanswered.
Additionally, CommEX states that any legal disputes will be resolved in Hong Kong. Binance has also refused to provide detailed information about the owners of CommEX but denies that the exchange uses the same underlying technology as Binance.
CZ also mentioned that CommEX does not serve users from the United States or the European Union, stating:
‘There are IP and KYC restrictions. This was a condition we asked for in the agreement.’
Zhao also clarified that he does not have ultimate ownership of CommEX and does not hold any shares in the new cryptocurrency exchange, stating:
‘There is no buyback option in the agreement. A Google search shows that some companies like Mercedes, McDonald’s, and Nissan have buyback options in their purchase contracts in Russia, but that’s not the case here.’
Brother — Twin?
The similarity between CommEX’s internal API codes and the exchange’s codes, as well as the ‘one-click’ exchange for Dutch users on Coinmerce, has also fueled suspicions about Binance’s involvement with CommEX.
Crypto enthusiasts have also noted a striking similarity in the language used in the terms of service of CommEX and Binance. It can be concluded that the crypto giant has no intention of loosening its grip on the Russian market. Frankly, such a strategy could prove very risky for the crypto giant, considering the increasing scrutiny from regulators worldwide.
Recently, a message was published in which Binance called on Russian users to switch to CommEX, offering a 25% trading discount for BNB holders on the newly created exchange.
Everything will be done to ensure a smooth transition. All user funds are safe!
— CZ 🔶 Binance (@cz_binance) September 27, 2023
Based on events this year, the exchange has had difficulties finding a banking partner in France, and a raid was conducted by regulators at its European headquarters in Paris as part of an ongoing investigation into alleged money laundering.
With its former banking partner, Paysafe, no longer in the picture, the exchange now faces the challenge of finding a replacement to continue its operations or perhaps consider the possibility of selling another recently created exchange.
CommEX Community Letter
CommEX announced that its exchange will officially be launched at 2023–09–26 12:00 (UTC).
On its official website, CommEX has stated that they are ‘transparent’ in their policies and are ready to answer your most pressing questions.
The team positions itself as a startup team comprised of dozens of passionate individuals from various works of life, including former employees of Binance. The project does not disclose UBO (Ultimate Beneficial Owner) information, denying any affiliation with Binance.
Why did Binance sell its Russian business to CommEX?
Response from the team:
“Utilizing the trust placed in us by former Binancians and backed by our proven technological prowess, choosing us is not a mere bet but rather a promising step towards achieving greater success. Cryptocurrency trading platforms have a history spanning over a decade. CEX have always been significant players in the industry, despite their shortcomings. We believe that the existence of CEX is a crucial part of the crypto industry. CEXs play a vital role in onboarding regular users into the Web3 space. We aspire to create an entirely new type of CEX, where the community and users constitute the most important part of the platform and significantly influence decisions,” the exchange declares on its official website.
In the ever-evolving landscape of cryptocurrency exchanges, CommEX emerges as an intriguing player, drawing attention for its enigmatic origins and connections to Binance. As the industry watches closely, the questions surrounding CommEX continue to grow.
While Binance’s decision to sell its Russian business to CommEX has raised eyebrows, it remains to be seen how this strategic move will impact the crypto world. With regulatory scrutiny intensifying, both Binance and CommEX face unique challenges and opportunities. As the story unfolds, the global crypto community eagerly awaits answers and clarity in this evolving chapter of the crypto saga.
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