Binance to Suspend U.S. Dollar Transfers
The largest cryptocurrency exchange in the world, Binance, said on Monday that it would stop accepting deposits and withdrawals in dollars. The business gave no explanation for the move.
According to a Binance spokesperson, as reported by CNBC, “We are temporarily suspending USD bank transfers as of February 8th. Affected customers are being notified directly.” The company also mentioned that “0.01% of our monthly active users leverage USD bank transfers” and added, “we are working hard to restart service as soon as possible.”
The company’s Binance US unit, which is subject to regulation by the Financial Crimes Enforcement Network of the Treasury Department, stated in a tweet that it is unaffected by the ban. So, only non-Americans are affected by the change. consumers who make dollar-based transfers to or from bank accounts.
https://t.co/gM6e3xb9BX is not affected by this suspension. Unless you see an official message from https://t.co/gM6e3xb9BX, our customers will not be affected.
— Binance.US Customer Support (@BinanceUShelp) February 6, 2023
Following the announcement, there was a substantial increase in withdrawals from Binance’s crypto wallets, according to data from Arkham Intelligence, as millions of dollar-pegged stablecoins like tether and USDC migrated to other exchanges or private wallets.
According to DefiLlama data, crypto exchange company lost almost $172 million in U.S. dollars over the day. For a business that, according to Arkham, has crypto assets valued at $42.2 billion, that is a rather small sum of money.
“We’re still overwhelmingly net-positive on net deposits,” the spokesperson said. “Outflows always tick up when prices start to level off following a bullish market swing like we saw last week as some users take profits.” Bitcoin rose over 38% in January, making it the company’s month since October 2021.
The revelation had little impact on the company’s exchange token, BNB, which remained stable at about $328.
Binance said in late January that U.S. banking partner Signature Bank had raised the threshold for dollar transactions to $100,000. Binance claimed at the time that Signature had informed the exchange that the increased requirement extended to all users of cryptocurrency exchanges.
Regarding the suspension, a representative of the company said in an email to CNBC that “Binance.US has its own banking partners and does not have any issues.” The main Binance exchange is not available to U.S. users.
Customers can still buy cryptocurrency using other fiat currencies or payment methods, according to Binance. For those affected, “we’ll have a new partner to announce for those users in the next couple weeks,” the spokesperson said.