The largest cryptocurrency exchange, Binance, said on Monday that it will no longer accept deposits or withdrawals in US dollars.
The company mentioned:
As of February 8th, we will be temporarily discontinuing USD bank transfers. Direct notifications are being sent to impacted clients. To resume service as quickly as feasible, 0.01% of our monthly active consumers use USD bank transactions.
The suspension solely affects non-US clients that utilize dollars to transfer money to or from bank accounts, according to Binance US, a company governed by the Financial Crimes Enforcement Network under the Treasury Department. This was confirmed via Twitter.
Following the announcement, a large rise in outflows from Binance’s crypto wallets was seen, with millions of dollar-pegged stablecoins like tether and USDC migrating to rival exchanges or private wallets, according to Arkham Intelligence.
According to DefiLlama’s data, Binance saw a net outflow of more than $172 million in US dollars for the day. Although this sum would appear insignificant compared to the company’s $42.2 billion in cryptocurrency holdings, according to Arkham.
On net deposits, we continue to be overwhelmingly net-positive. When prices begin to level out after a strong market swing like the one we saw last week, outflows always increase as some customers take winnings.
The news had little effect on BNB, the exchange token for Binance, which stayed constant at around $328.
Regarding Monday’s suspension, a Binance official wrote in an email to CNBC that “Binance US has its banking partners and does not have any concerns.”
US clients cannot use the main Binance exchange’s services. Customers can still buy cryptocurrency using other fiat currencies or payment methods, according to Binance. The spokesman promised that “we’ll have a replacement partner to announce for those individuals in the next couple of weeks” for the small number of affected users.