Binance Connect ceased operations on Aug. 16 due to the termination of support by Checkout.com. On Aug. 18, Binance conveyed that they are contemplating legal measures against Checkout.com, their former payment collaborator.
The root of the potential legal conflict lies in communications made by Checkout.com to Binance on Aug. 9 and Aug. 11. As per Forbes, Guillaume Pousaz, the head of Checkout.com, concluded their partnership with Binance, pointing to regulatory actions and concerns over compliance, Anti-Money Laundering, and sanctions.
A Binance representative stated, “We don’t concur with Checkout’s reasons for ending the partnership, and we’re reviewing potential legal avenues.” They emphasized that transaction services continue to be accessible on their platform.
Yet, this termination led Binance to halt Binance Connect, a regulated crypto transaction service, on Aug. 16. Initiated in March 2022, this service functioned as a bridge between traditional finance and crypto enterprises, supporting numerous fiat and crypto transactions. Forbes indicated that Binance was once Checkout.com’s prime client, overseeing around $2 billion in monthly transactions in 2021.
Recently, Binance has faced challenges in banking collaborations, causing difficulties for its worldwide outlets. In June, its European banking ally, Paysafe Payment Solutions, ceased support. Meanwhile, in Australia, Binance was unexpectedly disconnected from the banking grid. In the U.S., Binance.US encountered challenges in securing banking allies, with past collaborators Silvergate and Signature Bank halting services earlier this year due to a banking upheaval.
Changpeng Zhao, Binance’s chief, even pondered acquiring a bank in a recent conversation. Moreover, Binance’s legal and operational predicaments persist. On June 5, the U.S. Securities and Exchange Commission filed a lawsuit against both Binance and its chief, alleging securities law breaches and unlicensed securities offerings.