Binance.US ‘imploded’ with layoffs and revenue falloff after SEC lawsuit, latest filing reveals
Quick Take
- Binance.US had to lay off more than two-thirds of its staff after its revenue shrunk by 75% following the SEC’s enforcement action, its COO said.
The U.S. Securities and Exchange Commission’s lawsuit against Binance.US last June had forced the company to cut over 200 employees, or two-thirds of its staff, after a 75% decline in revenue, a Binance.US executive said, according to a new court document released on Tuesday.
“Our trading volumes and business more generally have imploded,” said Binance.US COO Christopher Blodgett during a December deposition released Tuesday. He also noted that there was “no actual wrongdoing” involved with Binance.US.
In the court document, Blodgett said that around $1 billion in crypto and fiat assets left the platform immediately following the SEC’s temporary restraining order, resulting in a revenue drop of more than 75% in the subsequent period. Beyond the short-term aftermath, the Binance executive claimed that the company struggled with the loss of trust from customers, in addition to legal and auditor fees.
Blodgett also said that Binance.US has lost its fiat payment rails as it parted ways with banking partners and that it was having difficulty finding new partners. “And who can blame them? Because the second it becomes known that they’re working with Binance.US, they can reasonably expect a nasty subpoena from the SEC,” said the Binance executive.
In June 2023, the SEC filed a lawsuit against Binance, Binance.US and its founder Changpeng Zhao for various charges including violations of securities laws. Zhao later pleaded guilty to violating the Bank Secrecy Act and stepped down from his position as Binance CEO and board chairman for Binance.US.
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