Amidst Binance’s ongoing legal battles, payment giants Visa and Mastercard have scaled back their associations with the crypto exchange.
This decision, although not unexpected, is predicted to have limited impact on Binance’s market dominance, according to industry experts.
Binance, renowned as the world’s largest cryptocurrency exchange by trading volume, has been grappling with a series of legal challenges in recent months.
These challenges include allegations from the U.S. Securities and Exchange Commission (SEC) of unregistered business operations and misleading investors regarding risks.
The U.S. Commodity Futures Trading Commission (CFTC) has also accused the exchange of willful evasion of U.S. laws.
The situation has further escalated with reports of the U.S. Department of Justice considering fraud charges against Binance.
Against this backdrop, payment processors Visa and Mastercard have taken steps to disassociate themselves from the embattled exchange.
Visa has reportedly ceased issuing new co-branded cards with Binance in Europe, while Mastercard confirmed the termination of its partnerships without divulging specifics.
The decision is anticipated to have little effect on Binance’s market standing. Experts cite the exchange’s global presence and substantial liquidity as key factors that will likely continue to attract traders.
Dave Weisberger, CEO and co-founder of CoinRoutes, stated that the exchange’s liquidity remains a pivotal point of interest for traders and will play a crucial role in maintaining its market share.
Leo Mizuhara, CEO of CFTC-regulated Hashnote, concurred, noting that the industry was already prepared for organizations distancing themselves from Binance due to its ongoing regulatory issues.
Mizuhara added that Mastercard’s move aligns with its burgeoning involvement in the blockchain sector and its cautious stance towards potential risk factors.
Visa and Mastercard have previously demonstrated their commitment to the blockchain industry, even during market downturns.
Their intent to collaborate with industry partners to introduce innovative payment programs into the market remains steadfast.
Despite the high-profile withdrawals of Visa and Mastercard, Binance’s continued liquidity and global reach are expected to shield it from a significant decline in market share.
Industry experts suggest that these developments may ultimately have a muted impact on both Binance and the broader cryptocurrency landscape.
Payment giants Visa and Mastercard distancing themselves from crypto exchange @binance’s isn’t surprising, experts say, given its legal battles with U.S. regulators. But the move is unlikely to hurt the company. @HeleneBraunn reportshttps://t.co/vsyaVqUNKT
— CoinDesk (@CoinDesk) August 25, 2023
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