Binance US to suspend dollar trading after halting activity of payment partners

In the latest blow to the crypto exchange facing a lawsuit from US regulators, the US branch of Binance is suspending dollar trading after its payment partners indicated they would halt US currency activity with it.

Binance US said in a statement on Friday morning that dollar trading through banks and other payment partners would be halted until June 13, and that it would start removing trading pairs tied to the US currency from next week.

The company said it would be transitioning to a crypto-only exchange.

The decision comes four days after the Securities and Exchange Commission filed a total of 13 civil charges against related entities including Binance, Binance US and CEO Changpeng Zhao.

Zhao said on Thursday that Binance US had about $2 billion in user funds “to the best of my knowledge”.

The SEC’s charges against the crypto group include operating unregistered exchanges and misrepresenting trading controls and monitoring on the Binance US platform. The regulator said that Binance and Zhao had control of client assets, and that Zhao used a secret offshore entity that was “critical” to Binance US operations to send over $16 million to a Binance-related entity. Used to provide money as described.

Binance.com, Binance’s offshore trading platform, said it was disheartened and disappointed by the SEC’s action, adding that while it took the regulator’s allegations seriously, they “should not be the subject of SEC enforcement action”. Binance US called the lawsuit “baseless”.

“Despite the unfounded claims, and in light of the increasingly aggressive tactics of the Commission, our payment and banking partners have indicated their intention to block USD FIAT channels as early as June 13, 2023, meaning that USD FIAT deposits will no longer be accepted.” Our ability to make and process USD fiat withdrawals will be affected,” Binance US said in its statement.

It added that as part of its crypto-only activity it will continue to support trading through stablecoins, a type of cryptocurrency designed to track the price of traditional currencies.

The move is the latest sign that Binance Group is struggling to maintain an active payment link linking cryptocurrencies to the traditional financial system. The filing by the SEC alleges that Merit Peak and Sigma Chain – two offshore entities that the regulator claims serve Binance and Zhao – both have accounts with Silvergate, and Merit Peak also has one at Signature. Yes, two defunct crypto-friendly banks.

In February, the wider Binance group announced it would suspend US dollar payments on the exchange. It did not give a reason for the decision.

A month later, Paysafe, an online payment provider, said it would cease services for UK customers of Binance. Earlier this month, Binance Australia closed all Australian dollar trading pairs, saying it was “working hard to find an alternative provider to continue offering AUD deposits and withdrawals to our users”.

In the latest blow to the crypto exchange facing a lawsuit from US regulators, the US branch of Binance is suspending dollar trading after its payment partners indicated they would halt US currency activity with it.

Binance US said in a statement on Friday morning that dollar trading through banks and other payment partners would be halted until June 13, and that it would start removing trading pairs tied to the US currency from next week.

The company said it would be transitioning to a crypto-only exchange.

The decision comes four days after the Securities and Exchange Commission filed a total of 13 civil charges against related entities including Binance, Binance US and CEO Changpeng Zhao.

Zhao said on Thursday that Binance US had about $2 billion in user funds “to the best of my knowledge”.

The SEC’s charges against the crypto group include operating unregistered exchanges and misrepresenting trading controls and monitoring on the Binance US platform. The regulator said that Binance and Zhao had control of client assets, and that Zhao used a secret offshore entity that was “critical” to Binance US operations to send over $16 million to a Binance-related entity. Used to provide money as described.

Binance.com, Binance’s offshore trading platform, said it was disheartened and disappointed by the SEC’s action, adding that while it took the regulator’s allegations seriously, they “should not be the subject of SEC enforcement action”. Binance US called the lawsuit “baseless”.

“Despite the unfounded claims, and in light of the increasingly aggressive tactics of the Commission, our payment and banking partners have indicated their intention to block USD FIAT channels as early as June 13, 2023, meaning that USD FIAT deposits will no longer be accepted.” Our ability to make and process USD fiat withdrawals will be affected,” Binance US said in its statement.

It added that as part of its crypto-only activity it will continue to support trading through stablecoins, a type of cryptocurrency designed to track the price of traditional currencies.

The move is the latest sign that Binance Group is struggling to maintain an active payment link linking cryptocurrencies to the traditional financial system. The filing by the SEC alleges that Merit Peak and Sigma Chain – two offshore entities that the regulator claims serve Binance and Zhao – both have accounts with Silvergate, and Merit Peak also has one at Signature. Yes, two defunct crypto-friendly banks.

In February, the wider Binance group announced it would suspend US dollar payments on the exchange. It did not give a reason for the decision.

A month later, Paysafe, an online payment provider, said it would cease services for UK customers of Binance. Earlier this month, Binance Australia closed all Australian dollar trading pairs, saying it was “working hard to find an alternative provider to continue offering AUD deposits and withdrawals to our users”.