The world’s largest cryptocurrency exchange, Binance, has announced the suspension of deposits and withdrawals of the US dollar using bank accounts. This suspension will take full effect on Wednesday, 8th of February 2023.
Although the reason for this decision was not disclosed, the tweet showed that the exchange has set plans into motion for the service to be reinstated in no time. However, other existing trading options will not be affected.
The announcement further revealed that this would not affect a lot of users as only a small proportion of users make use of this option. This was also corroborated by a Binance representative in an interview with Bloomberg. The representative maintained that only 0.01% of Binance’s monthly active users make use of this option. They also reiterated that other methods of buying and selling crypto on Binance such as Credit cards, Google Pay, and Apple pay are unaffected.
In a response to a user’s enquiry in the comment section on Twitter, BinanceUS. Customer Support disclosed that this decision does not affect the users of BinanceUS as both Binance and Binance US are separate entities.
Banks and Crypto
Binance has recently been plagued with banking difficulties in the United States. Signature Bank, its SWIFT transfer partner, had disclosed on the 21st of January 2023 that it would only process users’ trades with over $100,000 in their USD bank accounts, effective February 1, 2023. This decision comes after the bank had decided to reduce deposits from crypto clients significantly.
Following this new development, Binance on the 1st of February 2023 published a list of 144 countries where USD SWIFT transfers of any amount would be halted.
There has been an existing problem between crypto companies and banks in facilitating the sending of money to buy and sell cryptocurrencies. This could have been said to be caused by the warning issued to banks by federal regulators on conducting business with crypto firms after the collapse of FTX.
The CEO of Binance, CZ confirmed this in a tweet where he admitted that some banks are withdrawing their support for crypto while other banks are stretching a helping hand. He disclosed that these setbacks are expected after last year’s event (FTX collapse). He opined the crypto populace to look long-term and keep building.
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