CZ Acknowledges Bad User Experience as Binance Suspends US Dollar Transfers
The news follows US banking partner Signature Bank’s decision in January to only handle user transactions worth over $100,000.
Source: Shutterstock / Primakov, modified by Blockworks
Cryptocurrency exchange Binance is suspending US dollar transfers from Wednesday, but hasn’t given a reason for doing so.
“We are temporarily suspending USD bank transfers as of February 8th,” a spokesperson told Blockworks on Tuesday, adding that the exchange is upgrading its services. “Affected customers are being notified directly.”
Binance is working to restart services as soon as possible, but the spokesperson added, “only 0.01% of our monthly active users leverage USD bank transfers.” A current count of monthly active users was unavailable.
Meanwhile, all other methods of buying and selling crypto remain unaffected, the spokesperson said. This includes bank transfers using other fiat currencies supported by Binance (including euros), buying and selling crypto via credit and debit cards, Google Pay and Apple Pay and via Binance P2P marketplace.
Binance’s US arm said in a tweet that it’s not affected by the suspension, suggesting that only non-US customers who deposit or withdraw US dollars will be impacted.
The move comes after Binance said in January that its US banking partner Signature Bank would no longer handle SWIFT transactions below $100,000 from Feb. 1. The lender’s move stemmed from wanting to decrease exposure to digital asset markets.
A Binance spokesperson said at the time that the exchange was working to find an alternative solution, and that less than 0.1% of its average monthly users were being serviced by the bank.
Binance CEO Changpeng Zhao acknowledge in a tweet that the move reflected “bad user experience” and hinted that some banks are moving away from supporting cryptocurrencies.
Binance saw a large spike in outflows after the announcement, with millions of dollar-pegged stablecoins including tether and USDC leaving to competitor platforms, CNBC reported, citing data from Arkham Intelligence.
Still, the amount of US dollar outflows represented just a tiny fraction for a company with $42.2 billion worth of cryptoassets, the report said.
Binance’s native token BNB didn’t appear to be impacted by the news, and last traded 0.7% higher late Monday.
Get the news in your inbox. Explore Blockworks newsletters:
- The Breakdown: Decoding crypto and the markets. Daily.
- Empire: Crypto news and analysis to start your day.
- Forward Guidance: The intersection of crypto, macro and policy.
- 0xResearch: Alpha directly in your inbox.
- Lightspeed: All things Solana.
- The Drop: Apps, games, memes and more.
- Supply Shock: Bitcoin, bitcoin, bitcoin.
