CommEX shutters following Binance Russia takeover

abdelaziz Fathi

CommEX, the crypto exchange that acquired Binance’s operations in Russia in September, has announced it will cease operations and shut down its platform.

Starting March 25, 2024, CommEX will begin suspending services, including new user registration, asset transfer from Binance, and deposit services for both fiat and cryptocurrencies. The exchange plans to completely shut down its official website by May 10, 2024, and has advised users to close their positions and withdraw their assets in a timely manner.

The decision to wind down comes after CommEX launched in September, having taken over Binance’s Russian business amid growing scrutiny from the United States over potential violations of war-related sanctions against Russia. This move also followed a broader trend of Russian citizens turning to crypto exchanges due to Western sanctions impacting Russian banks’ access to global payment networks after the invasion of Ukraine.

Questions regarding CommEX’s ownership and base of operations have been deflected by representatives. The shutdown process includes halting futures trading on March 28, suspending peer-to-peer exchanges from April 2, and stopping all spot trading activities by April 23. The firm warned that user accounts holding assets after May 10 would be subject to a 1% asset management fee.

The closure of CommEX marks the end of a brief and controversial chapter in the Russian crypto market, following the high-profile exit of Binance from the country. Binance, founded in China in 2017 and later relocated due to a crypto crackdown, sold its Russian operations to CommEX in a deal shrouded in secrecy, with little information disclosed about the new exchange’s founders or executives.

Changpeng “CZ” Zhao, the founder and ex-CEO of Binance, denied being the owner of CommEX, which raised questions due to its similarities to Binance in terms of user interface and its recent establishment. However, CZ has refuted any connection between himself and CommEX.

Nevertheless, CZ acknowledged that some former members of the Binance CIS team may have joined the CommEX team, and he sees this as a positive development. He also mentioned that the design and APIs of CommEX are similar to Binance’s, which was done intentionally to ensure a seamless and familiar user experience for customers.

Binance, the world’s largest cryptocurrency exchange, announced Wednesday it will sell its Russian business to the newly-launched exchange CommEX. However, it did not disclose the financial terms of the deal.

The divestment process was expected to take up to one year to minimize disruptions for users during the transition, according to Binance.

The US Department of Justice’s national security division is investigating whether Binance or its executives violated US sanctions related to Russia’s annexation of Crimea and interference in Ukraine. This probe is separate from an ongoing inquiry by the DOJ’s criminal division into Binance’s compliance with anti-money laundering and tax laws.

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