CommEX, the crypto exchange that had taken over Binance’s operations in Russia, has announced its decision to cease operations in the country. The transition process will begin on March 25, with the exchange gradually winding down its services. This decision comes after Binance’s initial announcement in September 2023 that it would be exiting Russia within a year. The exchange will stop accepting new user registrations, halt asset transfers from Binance, and cease deposits in both fiat and cryptocurrencies on March 25. By March 28, there will be a winding down of opening positions for simple futures and futures trading.
Subsequently, on April 5, the publication of new advertisements on the P2P marketplace will come to an end. All P2P orders and advertisements will be automatically closed by April 18, followed by the closure of all trading pairs on simple and classic futures by April 23. The spot market will be closed by May 10, rendering the official website inaccessible to users. In regards to user accounts holding remaining assets after May 10, 2024, CommEX has stated that a 1% asset management fee will be applied. Users are advised to close their positions and withdraw assets to external wallets in advance.
The reasons behind CommEX’s decision to cease operations in Russia have not been disclosed. However, it is speculated that the exchange faced challenges following the takeover of Binance’s Russian business. Local clients switched to other platforms, leading to a decline in peer-to-peer (P2P) trading activity by 10% to 30%. As Binance discontinued all Russian ruble (RUB) services on January 30, 2024, following its exit from Russia, the situation for CommEX became increasingly challenging.
According to Roman Nekrasov, co-founder of the ENCRY Foundation, external factors such as pressure from U.S. regulators accusing Binance of money laundering and sanctions evasion played a significant role in Binance’s decision to exit Russia. Binance had also implemented various restrictions for Russian users, including limiting holdings to $10,000 and restricting transactions to ruble. Despite these challenges, Binance had reportedly generated annual revenues of $2 – $4 billion from its Russian user base.
The upcoming closure of CommEX’s operations in Russia highlights the challenges faced by crypto exchanges in navigating regulatory environments and maintaining user trust. The impact of external factors and changing market dynamics can have far-reaching consequences for industry players, ultimately shaping the landscape of cryptocurrency exchanges in the future.