Suspending USD deposits greatly reduces Binance’s ability to operate in the US as it focuses on becoming a “crypto-only” exchange.
Binance.US has announced the suspension of US dollar deposits and has notified customers that its banking partners are preparing to pause fiat dollar withdrawal channels as early as June 13. The suspension comes in light of an increasingly tense SEC lawsuit that accuses Binance of operating an illegal exchange in the US.
In a tweet, Binance.US claimed the SEC has resorted to intimidation and aggression in its pursuit of an “ideological campaign against the American digital asset industry”.
“Our business partners have not been spared in the use of these tactics,” it added, “which has created challenges for the banks with whom we work.”
Customers are advised to withdraw their USD balances by bank transfer by June 13. Any USD balances remaining on the platform after June 15 may be converted to stablecoin that can be withdrawn on-chain.
From next week, the exchange will also start to delist USD pairs such as BTC-USD, while continuing to support stablecoin pairs (e.g., BTC-USDT).
Binance reaffirmed they maintain 1:1 reserves for all customer assets, assuring customers that their funds are safe and secure. The exchange will now focus on operating as a “crypto-only” exchange, with crypto trading, staking, deposits and withdrawals operating as normal.
“Until we secure more stable banking partners, Binance.US will remain a crypto-only exchange – at least for a time.”
The lawsuit in a nutshell.
Earlier this week, the SEC filed a lawsuit against Binance for allegedly running an illegal exchange in the US. The filing stated 13 charges against the exchange, including mishandling customers’ funds, misleading investors, and blatant disregard of securities laws in the country. It also stated that Binance offered and sold unregistered BNB and BUSD tokens, the Simple Earn and BNB Vault products, and its staking program.
The case has brought a host of new cryptocurrencies to the SEC’s ‘securities’ classification, including BNB, BUSD, SOL, ADA, MATIC, ATOM, SAND, MANA, AXIS and COTI. Binance however has maintained that its native token, BNB, is not a security.
A spokesperson told Forekast that BNB is “a native token, designed to create an internal economy; thus, its value derives from its participants.”
The exchange has also defended itself by maintaining that it has no physical headquarters in the US. CEO Changpeng Zhao has said that the company’s headquarters is wherever he’s at a given time.
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