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Ongoing regulatory pressure has created a difficult working terrain for the banking partners of Binance.US.
Binance.US has told its customers that they may not be able to buy crypto with their US dollars from June 13. The Thursday announcement follows after the Securities and Exchange Commission (SEC) filed a lawsuit against the exchange and its founder Changpeng Zhao (CZ) on Monday.
SEC insists that Binance had violated the country’s securities laws. The exchange, on the other hand, says the regulator is only leveling “unjustified civil claims” against its business.
The official announcement reads in part:
“Today we are suspending USD deposits and notifying customers that our banking partners are preparing to pause fiat (USD) withdrawal channels as early as June 13, 2023.”
Binance.US to Lose Access to US Banking System
As it stands, the SEC is looking to freeze Binance.US’ assets. Interestingly, however, the regulator has also considered customers and asked the court to approve a temporary restraining order. This is to allow the exchange to continue processing withdrawal requests in the meantime.
Despite this, the regulatory pressure has created a difficult working terrain for the banking partners of Binance.US. Hence, the reason the so-called banking partners “signalled their intent to pause USD fiat channels”, from as early as next week.
Nonetheless, Binance has encouraged its customers to take appropriate action with their USD. It also assures them that their funds are safe. That is, even if they are unable to withdraw their money by the due date, they could still convert it to a stablecoin such as Tether (USDT), and then withdraw that. Thereafter, they may then convert the stablecoin back to dollars elsewhere.
The exchange said it had preemptively disabled customers’ ability to buy and deposit US dollars.
Transition in Progress?
The proactive measures taken by Binance.US to stop customers from buying and depositing US dollars may have positioned it as a crypto-only exchange. But that may be only until its case with the SEC is cleared up.
Presently, however, Binance.US has taken other measures to ensure that its US-focused platform continues functioning even without the banks. To this end, the exchange has also announced the de-listing of ten different trading pairs in light of the ongoing lawsuit.