Alaska and Florida regulators have forbidden Binance[dot]US, the American subsidiary of Binance, from operating in their states, as per a recent report from The Wall Street Journal.The ruling marks a significant development in Binance's legal and regulatory woes in the United States.

Last fall, Binance's founder, Changpeng Zhao, found himself entangled in legal woes after pleading guilty to charges related to violating U.S. anti-money laundering laws, a felony offense. Regulators in Alaska and Florida regarded Zhao, as an 80% owner of Binance.US, as unfit to oversee the company's operations, given his guilty plea.

As a result of Zhao's legal predicament, Florida's Office of Financial Regulation suspended Binance.US's money transmitter license, effectively revoking its right to serve users in the state. Similarly, the Alaska Division of Banking and Securities refused to renew Binance.US's license in January 2024, citing Zhao's guilty plea as a pivotal factor.

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Challenges and Legal Maneuvers

Despite facing regulatory roadblocks, Binance.US continued to operate in the United States, assuring customers of uninterrupted service. However, its legal battles escalated as Zhao attempted to leverage his $4.5 billion stake in Binance[dot]US as security to facilitate his travel to the United Arab Emirates. On December 29, Judge Richard Jones denied Zhao's request during a private hearing.

Binance[dot]US announced its decision to discontinue the trading of U.S. dollars on its platform last June. This strategic move came in response to pressure from federal regulators and banking partners.

The Securities and Exchange Commission (SEC) escalated its legal battle against Binance, accusing the firm and Changpeng Zhao of mishandling customer funds. Notably, the SEC sought a court order to freeze assets tied to U.S.-based customers of Binance, citing a pattern of regulatory non-compliance.