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Binance, the world largest cryptocurrency exchange, has announced that withdrawals and deposits of US dollars for the company global customers will be suspended beginning February 8. The company provided no specific reason for proceeding with the decision to halt the transfer of dollars. Binance banking partner Signature Bank raised some minimum transaction limits for dollar transfers earlier this year. Although the company saw a massive exit of millions of dollars worth of crypto after announcing the suspension, Binance said the organisation continues to maintain a "net-positive" status.
A spokesperson for Binance told CNBC, "We are temporarily suspending USD bank transfers as of February 8." Affected customers were informed directly, according to the spokesperson. Binance revealed that USD bank transfer methods are used by approximately 0.01 percent of the platform monthly active users. Further, the crypto exchange stated, "We are working hard to resume service as soon as possible."
Following the suspension announcement, Binance US, a company unit regulated by the Treasury Department Financial Crimes Enforcement Network, stated that the decision to suspend US dollar transfers had little impact on it. Binance US stated on Twitter, "This suspension has no bearing on Binance.US. Our customers will be unaffected unless you see an official message from Binance.US."
Only non-US customers who conduct dollar transfers and similar activities in the banks are still subject to the present ruling.
According to data from Arkham Intelligence cited by CNBC, Binance cryptocurrency wallets experienced a sharp rise in outflows of millions of dollars. These stablecoin-related crypto tokens included Tether and USDC.
Data from DefiLlama, as reported by CNBC, shows that Binance lost a net amount of US dollars on the day of announcements of over $172 million. However, that only represents a small portion of the company $42.2 billion worth of cryptocurrency assets.
The representative for the corporation stated that despite these setbacks, "We are still massively net-positive on net deposits." The firm also noted that after a bullish market swing, outflows always increase as prices start to stabilise. The trading platform was making reference to last week optimistic market activity. In the midst of all, the price of Bitcoin increased by more than 38% in January of this year since October 2021.
Binance said in January of this year that US banking partner Signature Bank had raised the threshold for US dollar transactions to $100,000. The minimal limit at the time applied to all users of crypto exchanges.