Binance crypto exchange will suspend US dollar transfers
- Binance will suspend US dollar withdrawals and deposits for international customers starting February 8, the company said.
- In January, Binance banking partner Signature Bank raised the transaction minimum for dollar transfers.
- Millions of dollars worth of crypto poured out of Binance after it announced the suspension, but the company says it remains “net-positive.”
Changpeng Zhao, billionaire and CEO of Binance Holdings Ltd., speaks during a session at the Web Summit in Lisbon, Portugal, Wednesday, Nov. 2, 2022.
Zed Jameson | Bloomberg | Getty Images
Binance, the world’s largest cryptocurrency exchange, will suspend deposits and withdrawals of US dollars, the company said on Monday, without giving a reason for the decision.
“We are temporarily suspending USD bank transfers as of February 8,” a Binance spokesperson told CNBC. “Affected customers will be notified directly.” The company said “0.01% of our monthly active users are leveraging USD bank transfers” and added that “we are working hard to restart the service as soon as possible.”
Binance US, a unit of the company that is regulated by the Treasury Department’s Financial Crimes Enforcement Network, said in a chirping that it is not affected by the suspension. The move therefore only applies to non-US customers who transfer money to or from bank accounts in dollars.
Data from Arkham Intelligence shows that following the announcement, there was a sharp increase in outflows from Binance’s crypto wallets, as millions of dollar-pegged stablecoins such as tether and USDC flowed to rival exchanges or individual wallets.
Binance’s net outflow of US dollars was over $172 million for the day, based on data from DefiLlama. That represents a small amount of money for a company that has $42.2 billion worth of crypto assets, according to Arkham.
“We remain overwhelmingly net positive on net deposits,” the spokesperson said. “Outflows always tick up when prices start to flatten out after a bullish market swing like we saw last week as some users take profits.” Bitcoin rose more than 38% in January, its best month since October 2021.
Binance’s exchange token, BNB, was largely unaffected by the news, holding steady at around $328.
See diagram…
Binance’s exchange token, BNB, since February 3, 2023.
In late January, Binance said its US banking partner Signature Bank had increased its transaction minimum in US dollars to $100,000. At the time, Binance said Signature had told the exchange that the new minimum applied to all crypto exchange customers.
Regarding Monday’s suspension, a Binance representative told CNBC in an email that “Binance.US has its own bank partners and has no problems.” The main Binance exchange does not serve US users.
Binance said customers can still use other fiat currencies or payment methods to buy crypto. For the small number affected, “we will have a new partner to announce to these users in the next couple of weeks,” the spokesperson said.
— CNBC’s Kate Rooney contributed to this report.
