Binance DEX will geoblock US-based customers
The use of proxies and VPNs is also against the Binance DEX terms of service.
Key points:
- Nationals of the United States and more than 20 other countries will be barred from Binance DEX
- US residents are being barred from an increasing number of cryptocurrency exchanges
- Australia is building a geofence from inside the country
Users from the USA, and a number of other countries, will not be able to use the Binance decentralised exchange (DEX) as of 1 July 2019, The Block reports. The full list of banned countries includes the USA and about thirty other names, including swaths of the Middle East, Central Africa and Eastern Europe.
According to the Binance DEX terms and conditions, US persons are already barred from using the exchange so the difference is likely that it will actively start barring US IP addresses as of 1 July, at which point people will probably start using VPNs to circumvent the ban.
Of course, "using any virtual private network, proxy service, or any other third party service, network, or product with the intent of disguising your IP address or location" is also prohibited by the terms and conditions.
The move means Binance DEX is the latest in a long line of exchanges that have barred US customers due to the fragmented regulatory situation in the States. While the US market is naturally important, many exchanges simply prefer to steer clear of the USA entirely rather than wade into the legal morass.
But it's interesting to note that this ban is a little stricter than those implemented by other exchanges that have left the country.
For example, when Bitfinex banned US customers, it extended the prohibition only as far as individuals whose primary residence is in the United States and business entities controlled by US persons. However, the Binance DEX ban goes as far as all citizens of the United States or other prohibited jurisdictions, regardless of where they reside, and entities owned 10% or more by US persons.
So it's a little bit different and may be an indication of how fuzzy the law can be in this area and which side of caution an exchange wants to err on.
It's also mildly entertaining to note that because the block extends to nationals of a country, regardless of where they are currently residing, it feels a little bit unintentionally racist.
Similar trends may emerge elsewhere, and Australian regulators are also preparing to build a regulatory fence around the country to keep out unapproved assets and overseas exchanges. As regulators move to accommodate digital assets, the markets are also getting more fragmented.
Also watch
Disclosure: The author holds BTC, BNB, ATOM and IOTA at the time of writing.
Latest cryptocurrency news
- SEC crackdown on Binance, Kraken – What it means for Aussie investors
- Sam Bankman-Fried found guilty – what it means for Australian FTX victims
- Bitcoin’s price soars over 10% on ETF rumours – here’s why
- New regulations for Aussie crypto exchanges: What it means for investors
- Sam Bankman-Fried’s FTX trial starts tomorrow – what it means for FTX customers
Picture: Shutterstock
