With the U.S. Securities and Exchange Commission (SEC) coming down hard on Binance, including Binance.US, it might just be the right time to revisit the Binance vs. Binance.US discussion. From the SEC’s perspective, both these exchanges are currently in muddy waters as of June 2023. Yet, the type of mud is different. Binance and Binance.US are different platforms. While the former is a global cryptocurrency exchange with several affiliates, Binance.US is strictly a U.S.-specific trading entity.
There are many cryptocurrency exchanges and wallets that provide great features for trading and investment, but one of the main platforms is Binance. Founded by Changpeng Zhao in 2017, Binance, the platform has grown massively over the years. Binance.US, on the other hand, arrived in 2019, months after Binance mentioned that it would no longer provide direct services to retail and institutional investors in the U.S. — citing regulatory concerns. Binance.US showed up soon after with a slightly truncated list of supported cryptocurrencies, services, and products for the U.S. folks, along with additional regulatory compliance.
While both offer a similar experience to their user base, certain important differences could be important to the average cryptocurrency investor. Furthermore, users in America can only use Binance.US, barring those residing in Texas, Vermont, and a few other states. Here’s what to know.
- Binance vs. Binance.US: the SEC effect!
- Supported cryptocurrencies
- The positioning of Binance Chain and Binance Smart Chain
- Trading fees
- Liquidity
- Supported countries
- User experience and interface
- Customer support
- Trust and reputation
- Increasing regulation
- Binance vs. Binance.US: a comparison table
- Binance vs. Binance.US: The verdict
- Frequently asked questions
Binance vs. Binance.US: the SEC effect!
Before we move to the more objective differences between the two, it is important to address the effects of the latest SEC-led fiasco on each cryptocurrency exchange. For starters, SEC entered 13 counts against Binance on the whole. And the extent of these charges includes its affiliate, Binance.US. The actions led by SEC against both belong to the same lawsuit and hinge on a belief that Binance maintained complete control over the U.S. arm, despite the latter being created as a separate entity — adhering to the country-specific regulatory compliance.
Firstly, Binance, the parent firm, offers and sells unregistered securities and products, including cryptocurrencies and its exclusive programs like the “BNB Vault” and “Simple Earn.” These charges even extended to Binance.US, with BAM Trading Servcies Inc. — the body running the U.S. branch of Binance — being charged with misleading investors. The U.S.-specific “Staking-as-a-Service” program was also questioned.
Impact on Binance.US
The SEC alleged that Changpeng Zhao and Binance continued to control the U.S. affiliate while allowing many high-profile U.S. customers to keep using Binance.Com, despite broader restrictions. And while these allegations were a tad generic, Binance.US is the cryptocurrency exchange getting sued by the SEC. This move scared banking partners, cutting off U.S. dollar-based trades completely.
As of now, Binance.US is now a crypto-to-crypto trading exchange with no support for on-ramping and off-ramping via the USD. Users who missed the deadline to cash out the deposited dollars can now convert the same to stablecoins and continue trading-related activities. Do note that the SEC initially wanted to freeze Binance.US’s assets but were rejected by the court, allowing trading activities to continue as usual.
While the entire SEC-driven fiasco caused a market-wide meltdown, Binance.US assured users that their funds were safe as part of the 1:1 reserve. Despite the assurance, the broader crypto market has been experiencing considerable FUD over the past few days. And that calls for a unified stance to thwart what looks like a coordinated attack on crypto.
“The SEC refuses to provide clarity, or a clear framework, to the crypto industry despite repeated prayers for such. Instead, it has chosen to weaponize its powers to witch hunt perceived enemies regardless of the impact of its actions on the investors it is supposed to protect.”
B (Da Viking), Core Contributor at Floki: Twitter
Now that we have some idea as to what transpired over the past few weeks let us now move to the actual differences between the two exchanges.
Supported cryptocurrencies
One of the clearest distinctions between the main Binance platform and Binance.US is the number of cryptocurrencies (and fiat currencies) with which you can trade. As of 2023, the number of cryptocurrencies supported by Binance.US stood at 130+. Do note that post the SEC crackdown, Binance.US decided to delist a handful of BTC, BUSD, and USD trading pairs. Some of the more popular ones include BCH/BTC, DOT/BTC, ONE/BUSD, and more. Also, as of 15 June 2023, Binance.US, for all its pairs, only supports crypto-to-crypto trading.
The original Binance currently supports over 500 cryptocurrencies and over 12,000 trading pairs. Despite SEC-led concerns, Binance continues to offer fiat-to-crypto trading, on-ramping, and off-ramping services to the users.
Also, it is noteworthy that Ripple (XRP) isn’t available for trading Binance.US, courtesy of the ongoing XRP-SEC courtroom drama. Additionally, Binance.US also lacks a Futures trading counter, something the parent company has.
If you are a user outside the U.S., there are greater opportunities to trade using Binance. For those in the U.S. wanting to do the same, Binance.US might still be a better option, courtesy of the additional regulatory compliance.
The positioning of Binance Chain and Binance Smart Chain
For someone trying to delve deep into the Binance vs. Binance.US discussion, it is crucial to discuss the supported chains. Both Binance Chain and BSC played a major role in developing the entire Binance ecosystem. The parent firm has now evolved from the Binance Chains to the BNB Chains, bringing newer staking, voting, and smart contract development standards into the mix. Yet, both BEP-2 and BEP-20 tokens are supported.
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Binance.US is more accommodative towards the Binance Smart Chain and BEP-20 tokens. Yet, the U.S. arm still supports some BEP-2 tokens.
Trading fees
When it comes to the fee structure, both platforms have the same standard fee of 0.1%. The difference is that additional fees vary, depending on whether you are within the U.S. or not. For example, fees for bank transfers to your Binance account are free outside the U.S. However, depending on your method of transfer, U.S. users may pay up to 4.5%. To simplify, these charges are valid on transfers made using debit cards. Even though the same isn’t allowed as of now, courtesy of the lawsuit, Binance.US has never actually allowed purchases made using debit cards. Only transfers or rather on-ramping was allowed as part of the fiat-to-crypto trading scene. Presently, it’s just crypto-to-crypto trading.
Binance supports credit and debit card purchases and even transfers. Compared to the 4.5% in the U.S., Binance charges a mere 1%, making it the more affordable of the two. For credit card purchases, though, the overhead can go as high as 3.5% or a flat $10, whichever is higher.
This disparity in fee structure favors users outside the U.S., where the higher fees may be related to tighter regulation of crypto in the country. By comparison to other platforms, the fee structure of Binance.US and Binance looks more complicated. Users from outside the U.S. benefit from lower fees.
What makes the fee structure so complicated is Binance’s focus on different fees for different levels of users. While, theoretically, this is similar in both the main platform and Binance.US, the American platform has fewer of these levels. For some, this may seem simple and clear; but it could also mean that using Binance.US is costlier than its main counterpart, tilting the Binance vs. Binance.US scales in favor of the former.
What about standard exchange fees?
As far as the standard cryptocurrency exchange fee structure is concerned, both Binance and Binance.US charge 0.1%. Using BNB for making trades and using referrals and codes can further lower the same on both platforms. Neither of these exchanges levies fees on account creation and deposits. However, the withdrawal fees differ, especially when bank transfers are concerned. Binance charges 1.5 USD for the same, whereas Binance.US charges a hefty 15 USD for each withdrawal. It is now evident that withdrawal fees on bank-based transfers are massively high in the U.S., something that can affect the user experience negatively.
Liquidity
The enforcement action by SEC has impacted liquidity and market depth associated with Binance.US. As of June 15, 2023, the U.S.-based exchange is ranked 32 in terms of spot trading liquidity, with an average score of 532.
Notably, the aggregated depth or the ability of an exchange to sustain large orders without impacting the price of the concerned assets has also reduced for Binance’s U.S. arm — going down from $34 million to $7 million — within a span of a week.
Still, liquidity concerns and the impact on the slippage and order execution rates haven’t surfaced as of yet.
Binance does support more liquidity, enabling faster transactions and trades, something which is important for the world’s biggest cryptocurrency exchange. It is still hanging onto the first rank in terms of spot exchange liquidity, with an average score of 885 as of June 15, 2023.
Still, the U.S. platform is still to catch up when it comes to providing users with the same amount of liquidity and ease when trading.
This, for users in the U.S., is rather unfortunate, making it a slower experience overall, perhaps leading to some finding alternatives to Binance.US. While the options in the U.S. are more limited, there are alternatives to Binance.US.
Supported countries
While supported in the United States, this is not entirely accurate, despite what the name suggests. Unfortunately, while most users in the U.S. can use this platform, it is not available in all states. Currently, the platform is only available in 44 of the 50 U.S. states. This is far from perfect, and the company has said that it plans to launch in all states by the end of the year. Whether this will happen remains to be seen. However, the lawsuit by Gary Gensler-led SEC isn’t doing this expansion plan any favors.
While Binance.US is restricted to the mainland due to geographical restrictions, Binance has a more widespread reach. But the global spread doesn’t come with its share of regulatory and geographical restrictions. Binance’s services are available in every country. One such country, while perhaps surprising, is the U.K. As of mid-2021, as the FCA (Financial Conduct Authority) ruled that the company’s U.K. arm is unable to conduct regulated activity, it has had a knock-on effect on U.K. users.
While, theoretically, U.K. users are still able to fully use the platform, responding to the ruling, a number of U.K. banks, including Barclays and HSBC, have since banned their customers from depositing into Binance.
Users must face such restrictions when using Binance. Among countries to crack down on the company are Hong Kong, Malaysia, and Lithuania. However, many countries do have full use of Binance, and these countries present opportunities for growth in these areas for the future.
User experience and interface
While a cryptocurrency exchange is often evaluated by the number of supported cryptocurrencies, the user interface remains one of the more underrated aspects. A good user interface can amplify user experience, allowing users to trade without lags or worries.
Binance, the parent firm, offers a more comprehensive app-specific user interface with the same segregated as “Basic” and “Advanced or Binance Pro.” The Binance Wallet integration supports every supported crypto and can be viewed via the Advanced or Pro UI. Plus, you also get access to a wide range of trading tools, spot trading resources, charting tools with trading volume and market depth analysis, and more.
Binance.US focuses on keeping things simple and streamlined. While most of the UI is similar to Binance, the complexity quotient is low. Like Binance, the U.S. arm also offers an app and support for the Binance Wallet.
Customer support
Reviews of Binance.US are, on average, worse than those of Binance, a small consolation for those who live outside the U.S. Despite this, many of the issues pointed to regarding support for American customers relate to issues that stemmed from the company’s rushed set up of the newer website.
Support for users of both platforms definitely needs some improvement. Currently, the support provided by Binance beats that of Binance.US. With the restriction limiting U.S. users to this platform, many choose to shift their accounts to other crypto exchanges completely.
If we look at the broader picture, customer support is 24×7. Both exchanges offer round-the-clock email support. However, features like Tele-calling and online chats are Binance-specific. In this regard, the U.S. arm needs to improve a lot. All of that tilts the Binance vs. Binance.US comparison in favor of the former.
Trust and reputation
While much of the trust and reputation of both Binance and Binance.US depends on the support and functionality of the two platforms, customer support is not the only factor that may affect their reputation. One such factor is the number of outages that the platforms have had, something far more common in the rest of the world than in the U.S. and a particular issue in mainland Europe. On this basis, Binance.US (despite being the newer platform) has experienced far fewer problems recently, boosting its reputation in territories that can access it.
Despite this, any lack of trust in Binance has a knock-on effect when it comes to how users perceive its U.S. platform due to the close association of the two. On reliability, the U.S. platform comes out on top. This does not mean that either has a good reputation. Binance has work to do, and lots of it. One step that both these exchanges are taking towards trust building is to include a host of 2FA elements. These include SMS and app-specific 2FA implementations as the standard security measures.
Increasing regulation
Several factors explain why Binance.US launched a separate platform. Changes in regulations and Binance’s own rules and reaction to external changes stand out as large drivers. But before we delve right into the regulation bit, here is a refresher that states which key individuals are in charge in regard to these exchanges. For Binance, it is still Changpeng Zhao, whereas Brian Shroder is the acting CEO of the U.S. arm.
Did you know? Catherine Coley — a former executive at Ripple (XRP) — was the first appointed CEO of Binance.US.
Also, when it comes to Binance, the regulatory radar is highly country-specific. In the recent past, the company has stopped those in Singapore from making trades on their platform, reacting to a tightening in regulations locally. Similarly, Binance recently had to face resistance in Canada, which led to it shutting shop in the mainland.
Binance.US, on the other hand, was created to adhere to US regulatory compliance. Overseen by Financial Crimes Enforcement Network (FinCEN), Binance.US adheres to the more stringent version of Know Your Customer (KYC) and Anti-Money Laundering (AML). Yet, the SEC crackdown, led by Gary Gensler and team, seems to have reopened the can of regulatory concerns.
While Binance remains the most preferable of the two platforms currently, it is important to remember that changes corresponding to the global regulatory landscape might have an effect on the user experience (s). That is one of the reasons why people have several Binance alternatives in their sight.
Binance vs. Binance.US: a comparison table
Still unsure as to how Binance differs from Binance.US. Here is a quick table for your reference:
Binance vs. Binance.US: The verdict
Outside of Binance, there has been a shift to using Coinbase or Gemini, but out of the two reviewed above, there is one clear leader.
Binance, the original platform, despite its many outages in recent months, stands out from its U.S. counterpart. The range of cryptocurrencies, features, and ease of use far outdoes Binance.US. Many hope that the number of faults and outages will reduce going forward.
The variation of available services, even from state to state, increases friction on the platform and rules out a large swathe of potential users. While this may improve with the expansion of Binance.US, currently, Binance is by far the better platform when it comes to choice.
Binance currently caters to both novice to veteran cryptocurrency traders, while American users struggle to make full use of the platform. Binance is, undoubtedly, the better and more developed platform and the best choice for users. However, the Binance vs. Binance.US discussion is an ongoing one in the wake of recent regulatory concerns, SEC enforcements, and other factors.
Frequently asked questions
What is Binance?
How do I create an account on Binance?
Is Binance secure?
What is the difference between Binance International and Binance us?
Why is Binance different in the US?
Can I use regular Binance in the US?
Which country is best for Binance?
Why is Binance restricted in the US?
Which has lower fees: Binance or Binance US?
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