Binance.US to Suspend USD Withdrawals Next Week
- Binance.US warned that due to the “extremely aggressive and intimidating tactics” of the SEC it will be temporarily transitioning to an all-crypto exchange.
- The company said USD deposits are already suspended, and that its banking partners were preparing to pause USD withdrawals as early as 13 June.
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Cryptocurrency exchange Binance.US has suspended all U.S. dollar (USD) deposits, and warned customers that USD withdrawals will also be paused next week, the company said via Twitter on 9 June.
According to the announcement, the decision to pause USD deposits and withdrawals was made due to the “extremely aggressive and intimidating tactics” of the U.S. Securities and Exchange Commission (SEC), which created challenges for the banks with whom the exchange works. The exchange noted that it will, for a time, transition to a crypto-only exchange, and assured users that it continues to maintain 1:1 reserves for all customer assets. The exchange wrote on Twitter:
“The SEC has taken to using extremely aggressive and intimidating tactics in its pursuit of an ideological campaign against the American digital asset industry. Binance.US and our business partners have not been spared in the use of these tactics, which has created challenges for the banks with whom we work.”
In its notice, Binance.US said that it has already suspended USD deposits to the platform, and warned users that its banking partners were preparing to pause USD withdrawals as early as 13 June. The company will also remove all USD trading pairs next week, but confirmed that crypto trading, staking, deposits, and withdrawals continue to remain fully operational. Binance.US also warned customers that any USD left on the platform might be converted into a stablecoin, and that USD withdrawals could be slow over the next few days due to elevated volumes and weekend bank closures.
The U.S. SEC filed a lawsuit against Binance, Binance.US, and CEO Changpeng “CZ” Zhao on Monday, alleging that the entities had violated U.S. securities laws, and on next day filed for a temporary restraining order to freeze certain assets of Binance.US. A court decision on the matter will be given on 13 June, the same day the exchange said it will be transitioning to an all-crypto exchange. In the same filing, the regulator accused Binance and Binance.US of redirecting around $12 billion in customer funds to a firm controlled by CZ, a claim which Zhao has vigorously denied.
- The DEX said it will remain under maintenance mode until a more permanent solution to counter the movement of illicit funds through the platform is implemented.
- THORSwap has seen a rise in popularity amongst bad actors, and was even used earlier this month by a hacker connected to the $600 million FTX hack from last year.
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- During an interview with FT, CEO Brian Armstrong said that before the lawsuit a SEC staff member had said that all crypto except BTC was security, and should be delisted.
- When asked how he came to that conclusion, the SEC staff member reportedly said “we’re not going to explain it to you, you need to delist every asset other that Bitcoin”.
- A federal judge ruled that the sale of XRP through exchanges and algorithms did not qualify as selling securities, which could have a major impact on several SEC lawsuits.
- The institutional sale of the token, however, did violate federal securities laws, and the lawsuit between the SEC and Ripple will have to go to trial.