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Binance Withdrawals: Exchange Suspends USD Deposits as Banking Partners Mull Fiat Pause

Last Updated June 9, 2023 11:02 AM
Omar Elorfaly
Last Updated June 9, 2023 11:02 AM

Key Takeaways

  • Binance.US announces halting all USD transactions
  • Binance.US will temporarily only allow crypto exchanges
  • The company blames the attack from SEC for the change in policy
  • Fans and stakeholders show support to the crypto trading platform

Binance.US announced  that due to the company’s legal issues because of the US Securities and Exchange Commission (SEC), the company will suspend all USD transactions, including withdrawals and deposits. 

Binance.US, Temporarily A Crypto-only Exchange

Binance.US tweeted, on June 9, that the company has been forced to halt all USD transactions, effectively enabling crypto-only exchanges. In its tweet, the company cited the decision came to be due to their struggle to reach an agreement with the SEC regarding the legitimacy of the company’s operations. 

The company announced that it would be halting USD withdrawals starting June 13th, encouraging its clients to withdraw all USD deposits in Binance.US accounts. The company’s official Twitter account also stated that the company will be “suspending USD deposits and recurring buy orders starting today.” However, “any deposits already initiated will be processed.”

The announcement also states that “any USD balances remaining on the platform after June 15 may be converted to stablecoin that can be withdrawn on-chain.”

Finally, the company announced that “until we [Binance.US] secure more stable banking partners, Binance.US will remain a crypto-only exchange.”

Fans and stakeholders took to Twitter to express their support for Binance.US and their dismay at the SEC, citing that the governmental entity is destroying the cryptocurrency market in the US.

SEC Attempts To Freeze Binance.US

The chaos surrounding Binance and Binance.US escalated on June 7, when the SEC filed a motion to the US federal government to freeze all Binance.US assets around the world, citing the necessity of maintaining the integrity of financial documents, fearing founder Changpeng Zhao would destroy evidence against their case. 

The crypto trader’s official account responded to the motion by saying that the “filing of the preliminary injunction is unwarranted and based more on the SEC Staff obtaining an advantage in litigation versus genuine concern about the safety of customer assets,” adding that “Despite the information, the company has provided to ensure SEC Staff of the safety of customer assets, the Staff has nonetheless decided to file the motion seeking a temporary restraining order and preliminary injunction.”

Understandably, the announcement caused commotion among stakeholders and clients of Binance.US. However, the company’s official Twitter account tweeted, reassuring its clients that “User assets remain safe and secure and the platform continues to be fully operational with deposits and withdrawals functioning as normal.”

SEC Vs. Crypto

In the midst of all the legal litigation against Binance, SEC finds itself fighting the cryptocurrency industry on another front. Binance’s biggest competitor, crypto trading platform, Coinbase finds itself head-to-head with the US SEC under the pretenses that the platform is operating illegally as an unregistered trader while selling registered securities. During deliberations, the SEC finds itself scrutinized by several parties, including governmental entities for trying to declare a platform as an illegal operator 2 years after approving its IPO and using it to sell confiscated crypto tokens.