Dear Member,
There were two major developments in the crypto world this week. One has the potential to really change trading in the U.S. for the better. And the other isn’t nearly as consequential as we thought it would be a year ago.
Let’s start with the good news.
Binance is back in business in the United States. The world’s most popular crypto exchange by volume stopped serving American customers on September 12. It withdrew from the U.S. because it wasn’t licensed to operate in the U.S. and – more importantly – it allowed Americans to trade hundreds of coins that the Securities and Exchange Commission (SEC) likely considers unregistered securities.
When Binance withdrew, it announced that it would relaunch in the future with a fully compliant exchange. That future became a reality this week.
On Wednesday, Binance.US began accepting deposits from U.S. residents in 37 states and Washington, D.C. The new platform, which operates in partnership with BAM Trading Services, will accept inbound transfers of bitcoin (BTC), ethereum (ETH), ripple (XRP), bitcoin cash (BCH), litecoin (LTC), tether (USDT), binance coin (BNB) and U.S. dollars.
If you have an existing Binance account, you’ll have to transfer your coins to Binance.US. If you’re trying to buy coins with fiat (U.S. dollars), you’ll have to make either an automated clearing house (ACH) or wire transfer. Debit and credit cards are NOT supported at this time. Trading won’t begin until there’s enough supply of a particular coin to create a healthy market. And, as of right now, Binance is NOT operating in the following states:
- Alabama
- Alaska
- Connecticut
- Florida
- Georgia
- Hawaii
- Idaho
- Louisiana
- New York
- North Carolina
- Texas
- Vermont
Texas, Florida, New York, Georgia and North Carolina are among the 10 most populous states in the U.S. So not operating there is a big blow. But Binance should be able to onboard more states over time. And as more states become crypto-friendly, this list will also shrink.
Of more importance is the fact that Binance is ambitious and plans on expanding its trading options over time. BTC, ETH, XRP, BCH, LTC, USDT and BNB are just the beginning for Binance.US.
It will add more coins to the platform over time as its “Digital Asset Risk Assessment Framework” clears them for trading.
The other coins currently under consideration are cardano, cosmos, basic attention token, bitcoin cash ABC, dash, eos, ethereum classic, holo, iota, chainlink, loom, decentraland, nano, neo, paxos standard, augur, ravencoin, trueusd, usd coin, vechain, waves, stellar, zilliqa and 0x.
There will also be no trading fees until November 1.
The Binance.US launch is a major step toward rebuilding a thriving altcoin market in the U.S. And we’re definitely happy to see it launch. For more details on the Binance.US launch, check out the company’s blog post here.
Now, let’s consider VanEck and SolidX withdrawing their bitcoin exchange-traded fund (ETF) from SEC consideration. From a tactical standpoint, they’re doing this because the SEC is still playing the role of knuckle-dragging obstructionist and isn’t ready to approve their ETF. By withdrawing their ETF application, they reserve the opportunity to resubmit in the future. And they don’t have a rejected ETF application on their file.
From a markets standpoint, the bitcoin ETF is irrelevant. A year ago, we were expecting a bitcoin ETF to spark a wave of institutional investment into crypto. That wave is now happening (and growing larger) without the bitcoin ETF.
Bakkt, a physically settled bitcoin futures exchange run by the parent company of the New York Stock Exchange, launches on September 23. Fidelity, with $2.46 trillion in assets under management, has been trading crypto for its larger clients for months.
Coinbase says it’s seeing between $200 million and $400 million a week in deposits from institutional investors.
Bakkt. Fidelity. Coinbase. They’re just the tip of the iceberg when it comes to institutional money entering the crypto space. The wave of institutional money entering the market is building. They’re investing in bitcoin first. And eventually, they’ll move into altcoins.
This wave will help fuel the new bull market. And it’s going to happen with or without a bitcoin ETF.