Binance.US, the American arm of the leading cryptocurrency exchange Binance, has announced the suspension of U.S. dollar deposits and the potential halt of fiat dollar withdrawals. These measures are set to take effect as early as June 13, shortly after Binance and its CEO Changpeng Zhao were sued by U.S. regulators.
In a tweet Binance.US stated that the decision was part of its proactive steps towards transitioning into a crypto-only exchange, at least for the time being. While U.S. dollar-related services will be affected, the exchange assured its customers that trading, staking, deposits, and withdrawals in cryptocurrencies would continue without disruption.
This move comes after the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance and its founder Changpeng Zhao earlier in the week. Following suit, the SEC also sued Coinbase, the largest cryptocurrency platform in the United States, the next day. These actions signify an escalation in the regulatory crackdown on the crypto industry, following the FTX debacle last year.
In a U.S. SEC filing made public, it was revealed that financial regulators in the U.S. supported freezing Binance’s assets. Matthew Dibb, COO of Singapore crypto platform Stack Funds, acknowledged the potential impact of the suspension, stating that Binance.US is significantly smaller than its international counterpart, and the halt of withdrawals would understandably create worry and panic among users. Dibb also noted that given the recent series of comments and issues from the SEC and regulators, the suspension was somewhat expected.
Surprisingly, the news did not significantly affect cryptocurrency prices, with bitcoin experiencing only a marginal decline to $26,496 during Asian trading on Friday. Bitcoin was on track for a weekly loss of approximately 2% after reaching a low of $25,350 earlier in the week amid concerns over the SEC’s actions. Binance’s BNB token also saw a slight decrease of 0.46% to $261.46.
Tony Sycamore, a market analyst at IG Markets, remarked on the muted reaction from the market, suggesting that it may have either shrugged off the news or not fully grasped its implications yet.
In its tweet, Binance.US criticized the SEC’s stance on cryptocurrencies as “extremely aggressive and intimidating” and pledged to vigorously defend itself, its customers, and the industry against what it deemed meritless attacks from the regulatory agency.
The crypto industry has been highly critical of SEC Chair Gary Gensler in the wake of the lawsuits. However, Gensler has rejected the notion that the agency is attempting to crush the crypto industry and has emphasized the need for regulatory scrutiny.
