Binance suspends UK crypto transfers

Binance halts cryptocurrency withdrawals and deposits for its UK customers.

The move comes a month after the company temporarily suspended dollar trading, marking the latest setback for the world’s largest crypto platform.

“Paysafe, our fiat partner that provides GBP deposit and withdrawal services via bank transfer (Faster Payments) and via card (Card Deposit) to Binance users, has informed us that they will no longer be able to provide these services from 22 May 2023 “, the company said in a statement provided to PYMNTS on Tuesday (March 14).

“These GBP deposit and withdrawal services will be suspended from 15.00 13 March 2023 for new users. On May 22, 2023, these services will be suspended for all Binance users.”

In a separate statement provided to PYMNTS, Paysafe said it had “concluded that the UK regulatory environment in relation to crypto is too challenging to offer this service at this time and therefore this is a sensible decision on our part taken with an abundance of out of caution.”

Binance says it is working on finding an alternative. And while the company argues that the move affects fewer than 1% of customers, Paysafe’s decision is the latest in a series of problems for a company sitting at the top of an already troubled industry.

“If Binance’s ability to navigate industry turmoil and deal with US regulators is a test case for the future of crypto, it looks more murky than rosy,” PYMNTS wrote last week.

That followed reports that Binance allegedly created its US platform as a shield from regulators, with newly discovered internal memos and interviews from company employees revealing a strategy by the company to position Binance.US as a seemingly independent entity to protect itself from to increase scrutiny.

A spokesperson for Binance told PYMNTS that the agreement between Binance and its US operations is common in the crypto-word, with Binance’s founders licensing the technology stack to other organizations that were not affiliated with the company.

“While growing at such a rapid pace, we made some initial missteps that have now been rectified,” the spokesperson said. “After a massive investment in compliance talent, processes and technology over the past two years, we are a very different company today when it comes to compliance.”

Meanwhile, the crypto industry has found itself dealing with other headaches of late following the collapse of two banks popular in the sector, Signature and Silvergate.

Signature, which was taken over by regulators over the weekend, became one of the few banks to accept cryptocurrency deposits in 2018 and had relationships with major players such as Circle, Coinbase and Kraken.

“Signature’s troubles mark yet another major setback for digital assets as the crypto industry loses yet another one of its last remaining forays into the traditional banking system,” PYMNTS wrote.

Signature operated a proprietary payment network called Signet that allowed commercial crypto clients to make real-time payments around the clock. With that gone, many industry observers say crypto firms now have little option but to look to overseas locations.