Crypto Exchange Binance To Suspend Withdrawals, Deposits Of US Dollar

Binance suffered a loss of net US dollars outflow of over $172 million on the day of announcements.

Binance, the world's largest cryptocurrency exchange, has announced to suspend the withdrawals and deposits of US dollars for the company's global customers from February 8. The company did not give any particular reason for going ahead with the decision to suspend the transfer of dollars. Earlier in January this year, Binance banking partner Signature Bank raised some minimum amount of transaction limits for dollar transfers. Although the company saw a massive exit of millions of dollars worth of crypto after announcing the suspension, Binance said the organisation continues to maintain a "net-positive" status.

According to a report by CNBC, a Binance spokesperson said, "We are temporarily suspending USD bank transfers as of February 8." The spokesperson added that affected customers were being notified directly. Binance revealed that about 0.01 percent of the platform's monthly active users use USD bank transfer methods. Commenting further on it, the crypto exchange said, "We are working hard to restart service as soon as possible."

Following the suspension announcement, Binance US, a company unit regulated by the Treasury Department's Financial Crimes Enforcement Network, stated that it was not impacted much by the decision to suspend the transfers in the US dollar. Binance US tweeted, "Binance.US is not affected by this suspension. Unless you see an official message from Binance.US, our customers will not be affected."

The current decision remains applicable only to non-US customers who engage in dollar transfers and related transactions in the banks.

Citing Arkham Intelligence data, CNBC reported that the crypto wallets of Binance witnessed a sudden increase in outflows of millions of dollars. These were Tether and USDC crypto tokens related to stablecoins.

Binance suffered a loss of net US dollars outflow of over $172 million on the day of announcements, according to data from DefiLlama, as cited by CNBC. However, that means a minimal amount of the company money that has $42.2 billion worth of crypto properties.

Despite these hiccups in the company, the spokesperson said, "We are still overwhelmingly net-positive on net deposits." The company added that outflows always go up when prices begin to level off after a bullish market swing. The platform was referring to the bullish market behaviour last week. Amid this, Bitcoin's prices spiked to more than 38 percent in January this year ever since October 2021.

Earlier in January this year, Binance stated that US banking partner Signature Bank did increase the minimum amount of US dollar transactions to $100,000. During that time, the minimum limit was applicable for all crypto exchange customers.

Meanwhile, on the current suspension, the crypto exchange said, "Binance.US has its own banking partners and does not have any issues." The customers of Binance can continue to use other fiat currencies or different available payment methods to buy crypto tokens.

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