Crypto Exchange, Binance, recently announced it will temporarily suspend all USD bank transfers on Crypto payment on its platform. This is coming after New York’s Signature Bank provider of the SWIFT NETWORK implemented a $100,000 minimum deposit limit on Crypto transfer using the Swift Payment System.
It’s interesting to see the trend evolving in 2023. I presumably think the general consensus for most banks will be to join in— there is too much potential in Crypto / Web3 for the majority not to see it as a significant source of positive change.
Top Centralized Exchanges like Coinbase, MEXC Global, Huobi, alongside Binance had partnered with various banks to help create payment processors for executing crypto fiat payments.
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Binance noted 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”.
Changpeng Zhao, Binance CEO tweeted on microblogging platform Twitter that,
It is worth noting that USD bank transfers are leveraged by only 0.01% of our monthly active users. However, we appreciate that this is still a bad user experience and the team is working on quickly resolving this issue. While some banks withdrawing support for crypto, other banks are moving in. Some setbacks were expected from last year’s incidents. Long term, keep building.
With this new development, Binance users in the United States of America will have to process crypto transfer using the other available channels, this will somewhat impact institutional funding, mostly Futures traders and Arbitrage flippers will have to navigate through other alternatives in depositing funds on Binance. However, Binance.US noted that its U.S. customers can safely and securely withdraw and deposit USD on the platform via ACH transfer.
Penzmalac a Binance user posted on Binance Forum; “For me, funding my Binance account by USD bank transfer has always been the #1 choice. No fees, no transaction timeouts, no errors. I would be very happy for a solution here”.
The SWIFT Network is a protocol used by banks for cross border transactions. This will affect Crypto Exchanges, but Cryptocurrency Users can still buy and sell crypto on exchanges and send crypto anywhere in the world on their respective Blockchains.