The closure of the cryptocurrency exchange CommEX will not be a significant loss for the Russian crypto market, according to Sergey Mendeleev, CEO of Indefibank, in a comment to ForkLog.
CommEX failed to meet certain “obligations to Binance under the concluded deal,” as previously reported by representatives of the latter. What exactly Binance meant remains speculative, as the agreement was private.
“Turnover, number of users, profit—I don’t know, the terms of the deal were closed, but I never believed that money was involved as an initial payment,” noted Mendeleev.
It can be expected that CommEX’s place will not remain vacant—Binance is already in talks with several other service providers regarding the resale of its business in Russia.
“It remains to be understood, what exactly is being sold? User base? Apparently not. Brand? Also unlikely. Software? Again, no. What exactly is Binance selling? It’s unclear,” Mendeleev wonders.
The expert also found it difficult to suggest who could become the new Russian successor to the largest exchange by trading volume.
“There are only about five teams in Russia capable of handling this. I called them all—nobody knows,” he reported.
Mendeleev added that he himself would not mind promoting a separate branch of Binance to the required levels as a director, “if they are realistic.”
The Offshore Shadow
According to Yulia Privalova, head of the FinTech & Crypto practice, CommEX’s activities have long raised questions. It was created and registered its domain a few days before the deal to purchase Binance’s Russian business.
“Registration in the Seychelles allowed it to take advantage of offshore jurisdiction benefits, including confidentiality and the ability to have a nominal director. This raises certain concerns about the transparency of operations and the identification of ultimate beneficiaries,” explained the lawyer.
She also mentioned several possible reasons for the termination of the deal with Binance, including:
- failures in fulfilling financial or operational obligations;
- regulatory hurdles, including audit complications due to the choice of offshore jurisdiction;
- user distrust of the new and little-known platform, which slowed the transition between exchanges.
Privalova did not rule out that additional questions for CommEX might have arisen in the context of legal proceedings involving the SEC and Binance.
Nikita Zuborev, an analyst at the BestChange aggregator, also suggested financial issues with the platform.
“If we adhere to the stated theses (violation of deal terms and revision of strategic plans), it is quite likely that the Russian segment of Binance was purchased in installments with a predetermined payment schedule, while CommEX did not receive the expected commission profits to consider further payments feasible,” he stated.
Where Should Russians Turn?
Zuborev noted that CommEX’s audience was not significantly large. Most former Binance users from Russia were understandably distrustful of the young and private project and were already seeking alternatives. Therefore, the analyst does not anticipate a large wave of user migration.
“If we talk about the most popular exchanges among Russians, they are Bybit, MEXC, KuCoin, Gate.io, and Bitget. All these exchanges offer trading in rubles on their P2P platforms. It is also worth mentioning OKX and CoinEx in the context of popularity among Russian citizens, but interacting with rubles on these platforms is not possible, although otherwise, the rights of Russians were not infringed,” the expert listed.
He also mentioned the upcoming launch of the Blum exchange, created by former Binance director in Asia and Eastern Europe Gleb Kostarev and former top manager of the exchange in the CIS Vladimir Smerkis.
In Zuborev’s opinion, the audience, tired of the practice of service termination, will be able to improve their cryptocurrency handling skills and move on to other tools: storing cryptocurrency in non-custodial wallets, trading on DEX, buying and selling cryptocurrency through exchangers.
“With such an organization of processes, there will be no need to worry about possible sanctions or access closures; these tools will always be available regardless of the political decisions of any particular company,” the analyst explained.
After Binance announced its exit from Russia, some users switched to other platforms instead of the alternative in the form of the CommEX exchange. Bybit, HTX, KuCoin, and Gate.io recorded an influx of new clients.
In January 2024, the most visited exchange by Russians became Bybit. MEXC and Bitget also noted user activity from Russia.