Binance.US, one of the largest cryptocurrency exchanges in the world, has announced that it will no longer accept U.S. dollar deposits and customers will soon not be able to withdraw dollars from the exchange.
The decision comes after the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance, its founder and CEO Changpeng Zhao, and the operator of its U.S. exchange, alleging that the company had artificially inflated its trading volumes, diverted customer funds, failed to restrict U.S. customers from its platform, and misled investors about its market surveillance controls.
In a Friday (June 9) blog post, Binance.US called the SEC’s actions “extremely aggressive” and said the new developments are an attempt to protect itself. The SEC has asked a federal court to freeze Binance’s U.S. assets, a motion that Binance.US has called “unwarranted.”
Binance.US will change to a “crypto-only exchange,” per the blog post, with its banking partners preparing to stop dollar withdrawal channels as early as June 13. However, the exchange has assured customers that crypto-denominated trading, deposits, withdrawals, and “staking” will remain fully operational.
The news has caused concern among investors, with Matthew Dibb, COO of Singapore crypto platform Stack Funds, saying that “halting of withdrawals is obviously going to create or spur quite a bit of worry and panic,” per a Reuters report.
Despite the turmoil, crypto prices have barely reacted to the news, that report noted, with bitcoin last trading flat at $26,512. Binance’s BNB token, the world’s fourth largest, slid 1.5% to $258.76.
The SEC filed its 13 charges against Binance and Zhao in U.S. District Court in Washington, D.C., on Monday (June 5).
Binance responded on the same day with a blog post in which it said it is “disappointed” with the SEC’s decision because Binance has cooperated with the regulator’s investigations and that the company will “defend our platform vigorously.”
By the following day, Tuesday (June 6), Binance customers had withdrawn over $778 million from the cryptocurrency platform and $24.5 million from Binance.US in the wake of the charges.
As PYMNTS reported Wednesday (June 7), following the SEC’s targeting of both Binance and Coinbase, the SEC has said every crypto exchange is violating securities laws.
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