The world’s largest cryptocurrency exchange Binance has announced it is temporarily halting all US dollar bank transfers on its site from 8 February.
Binance made the announcement via its Twitter page and reassured that “only a small proportion of our users will be impacted by this”.
From February 8th, we will temporarily suspend all USD bank transfers.— Binance (@binance) February 6, 2023
Only a small proportion of our users will be impacted by this and we are working hard to restart the service as soon as possible.
All other methods of buying and selling crypto remain unaffected.
Whilst the crypto exchange did not go into full detail in regards to why it was pausing USD transfers, it did affirm that they are working on restarting the service as soon as possible, whilst also reaffirming that crypto buying and selling would be unaffected by the halt.
However, Binance.US confirmed that it would be only Binance.com making the decision to halt USD transfers on 8 February, as the Binance.US customer support Twitter page stated they are “not suspending USD withdrawals and deposits on February 8. This news is only for Binance.com users. We are completely separate entities from Binance.com”.
Binance CEO, Changpeng Zhao, commented that USD transfers only amount to 0.01% of Binance’s monthly active users, but appreciated that this may still cause issues to users.
He stated: “It is worth noting that USD bank transfers are leveraged by only 0.01% of our monthly active users. However, we appreciate that this is still a bad user experience and the team is working on quickly resolving the issues.
“While some banks withdrawing support for crypto, other banks are moving in. Some setbacks were expected from last year’s incidents. Long term, keep building.”
To say the crypto sector suffered some incidents last year would be putting it mildly. The two high-profile collapses of FTX and TerraLuna sent shockwaves across the entire industry and resulted in a crypto winter not seen since pre-2020.
As a result of FTX’s collapse, proof of reserves for every exchange on the market was questioned, with Binance being one of the first to report its reserve holdings, but pulled the report from its site after receiving backlash from some sectors of the industry. This also came after a wave of withdrawals were made from Binance in December, but this may have had more to do with customer confidence waning after the collapse and mishandling of consumer funds by FTX.