- Binance.US has given the notice to suspend USD deposits over "aggressive and intimidating tactics" by the US SEC.
- The exchange noted that its banking partners would do the same for US Dollar withdrawals from June 13.
- The move is part of the platform’s temporary transition to a crypto-only exchange.
- Crypto trading, staking, deposits, and withdrawals will remain operational.
Binance.US, the American arm of Binance.com, said Thursday that it will suspend US Dollar (USD) deposits, noting that its banking partners would do the same for withdrawals from June 13. The crypto exchange attributed the decision to "aggressive and intimidating tactics" by the United States Securities and Exchange Commission (SEC), which on Wednesday asked a court to issue a temporary restraining order to freeze Binance's assets in the US.
Binance.US to suspend Dollar deposits
Binance.US plans to suspend USD deposits days after the US SEC moved to freeze the exchange’s assets after filing of lawsuits against Binance and Coinbase. The federal regulator filed for a restraining order to freeze the assets of Binance.US, with a special interest in BAM Management US Holdings, the holding and operating firms for Binance.US.
The SEC has taken to using extremely aggressive and intimidating tactics in its pursuit of an ideological campaign against the American digital asset industry. https://t.co/AZwoBOgsqS and our business partners have not been spared in the use of these tactics, which has created… pic.twitter.com/rlIe6swIoY— Binance.US (@BinanceUS) June 9, 2023
The news follows an official status update from Binance.US, calling out the SEC for its “extremely aggressive and intimidating tactics” as it moves forward with its crackdown against the American digital asset industry. The move has put Binance.US and its business partners in the crosshairs, creating challenges in their operations and service to users.
The exchange has therefore decided to suspend deposits in US Dollars to protect customers and the platform from the brunt of what would follow as the SEC crackdown continues.
Binance access to US banking system constrained
Similarly, the exchange has revealed that the decision comes in tandem with its banking partners to halt USD withdrawals, giving users only four days to do the needful concerning their USD. It, therefore, means that customers will no longer be able to use USD to buy crypto on the platform after June 13, which hobbles Binance.US' ability to do business in the United States.
This does not mean that customers who have not withdrawn their money by the shutdown date will lose their funds. In theory, they could convert it to a stablecoin such as tether (USDT), withdraw it and convert it back to dollars elsewhere.
However, the mishap between the platform's payment and banking systems suggests that Binance’s banking partners have deemed the exchange too risky a client to continue dealing with. It also means the revelations from the federal regulator have become a concern.
Among the platform's banking partners that have helped Binance.US process billions of dollars in transactions in the past include Axos Bank, Cross River Bank, and the failed Silvergate, Signature, and Silicon Valley banks.
Binance.US admits to productive compromise
Like Binance CEO Changpeng Zhao earlier, the platform has reiterated its commitment to prioritize customers, saying that the suspension is only temporary as part of its effort to transition to a crypto-only exchange. According to the platform, this is a productive compromise which is expected to bolster a “thriving digital asset marketplace" in the US.
The exchange said it is committed to defending itself, its customers, and the entirety of the industry against the “meritless” jabs from the regulator.
Considering the weekend is approaching, Binance.US has forewarned customers of expected downtime and delays:
Any downtime in processing withdrawals may be the result of elevated volumes and weekend bank closures.
Nevertheless, the platform will maintain a 1:1 reserve for all customers’ assets, with uninterrupted crypto trading, staking, deposits, and withdrawals, it said.
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