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Binance to halt all USD transfers via SWIFT beginning Feb. 8

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(Kitco News) - Binance, the world’s largest cryptocurrency exchange, announced that it will be suspending deposits and withdrawals of U.S. dollars for its international exchange beginning Feb. 8, according to a Twitter post the company made on Monday.

The exchange offered no explanation for the halt to U.S. dollar transactions, but simply added that “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.”

U.S.-based crypto traders who utilize the services offered by Binance.US were quick to respond to the announcement asking if they too would be affected. The U.S. branch of the exchange assuaged those concerns by highlighting that Binance and Binance.US are separate entities, and reassuring them that “Binance.US is not affected by this suspension. Unless you see an official message from Binance.US, our customers will not be affected.”

Binance CEO Changpeng “CZ” Zhao also took to Twitter to minimize the impact of this announcement, telling users that “It is worth noting that USD bank transfers are leveraged by only 0.01% of our monthly active users.”

That said, CZ acknowledged “that this is still a bad user experience and the team is working on quickly resolving this issue.” He went on to add that “While some banks [are] withdrawing support for crypto, other banks are moving in. Some setbacks were expected from last year's incidents. Long term, keep building.”

This is the second notable banking challenge related to U.S. dollar transfers for Binance in 2023. On Jan. 21, the exchange’s SWIFT transfer partner Signature Bank informed the firm that it would only be able to process fiat transactions of more than $100,000 beginning on Feb. 1.

Binance wasn’t the only crypto firm affected by this decision, as Signature Bank stated that all of their crypto exchange clients are subject to the same minimums as the bank attempts to decrease its exposure to the digital asset market, according to Bloomberg.

“This is the case for all of their crypto exchange clients,” the letter from Binance said. “Please be advised that until we are able to find an alternative solution, you may not be able to use your bank account to buy or sell crypto with USD via SWIFT with a value of less than $100,000 USD after February 1st, 2023.”

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Binance noted that SWIFT-based transfers would remain in operation for non-USD bank transfers, such as the Euro, and that the change won’t impact corporate accounts.

The exchange also sought to reassure customers that they are still able to use their credit or debit cards to buy or sell cryptocurrencies and that any payments to or from third-party exchanges would still be processed.

Binance currently operates exchanges in more than a hundred countries including Canada, Australia, Egypt, Italy, Israel and France, according to its official website. A total of 144 countries have been affected by the suspension of SWIFT USD transfers.

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