Binance’s US subsidiary has announced a “seedround” of more than 200 million. This new funding shows that the company is serious in expanding its North American operations.
The U.S. affiliate of Binance announced Wednesday that it had raised more than $200m from Circle’s venture wing and other investors including VanEck, RRE Ventures, and others.
The company calls the investment a “seedround” and said that the new money values Binance.US to $4.5 billion.
Binance.US CEO Brian Shroder told decrypt that the company will use the funds to grow its spot trading platform and launch new products, services and acquire other companies.
This all comes at a moment when Binance.US, the parent company, is trying to gain trust with regulators and governments around the world. They have previously accused Binance.US of not following know-your-customer laws.
This effort included hiring ex-tax and law enforcement agents and executives from traditional finance and tech. Binance recently appointed a longtime Microsoft veteran to its CTO.
The stakes are especially high in the United States where Binance is being investigated by the Justice Department and the SEC, as well as other agencies. This could explain why the company hired Shroder, an ex-uber executive who is low-key, to head its U.S operations.
Binance’s US ambitions
The lines separating Binance.US from its parent company were blurred in the past. In 2020, Forbes presented evidence that Binance’s U.S. affiliate was intended to distract regulators from the fact that many Americans were trading on the platform’s loosely-regulated global marketplace.
Binance may have turned a new page with the hiring of Shroder six-months ago and the new seed round backed in part by well-known investors. However, Binance’s founder Changpeng Zhao (who until recently enjoyed operating as an independent) will keep an indirect hand.
Shroder explained to Decrypt via email that Binance.US and Binance.com are separate legal entities. “CZ is both the founder and chairman of both companies. Binance.US’s management and I are responsible to manage the company’s day to day operations, decision-marking and overall business strategy.
Binance.US’s biggest challenge in the near term is likely to be attracting marketshare into a market that is dominated by long-standing incumbent Coinbase. CoinGecko data shows that Binance.US’s spot market volume in the last 24 hours was only one-tenth of Coinbase’s, but it was well ahead of FTX (another high-profile upstart).
Shroder claims that Binance.US is making great inroads with very little marketing and will continue to increase its advertising efforts after the funding round.
Shroder stated that “we also believe that our platform offers inherent competitive advantages – including lower fees and a more sophisticated trade experience – which will continue attracting both retail and institution customers.”
Currently, Binance.US. It claims it can process more than 1.4 million orders per seconds and offers more 85 tokens and 190 trading pair on its platform.
CZ is stepping up his ambitions for Binance as a brand. He recently declared that he plans to acquire non-crypto businesses in an effort to expand the industry’s footprint. One such venture was made by CZ, who recently laid down $200m to invest in Forbes.
Binance.US also has Original Capital, VanEck and Gaingels as investors. Binance refers to these investors as “mission-driven firms focused on diversity and equity and inclusion.”
