Binance.US Halts Direct Dollar Withdrawals
U.S. dollar deposits in user wallets are no longer eligible for FDIC insurance protection, according to the updated terms of use.
Oct 17, 2023 at 12:14 p.m. UTC
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Binance.US users can no longer withdraw dollars directly from the platform after the exchange updated its terms of use on Monday.
"In the event that customers wish to withdraw U.S. dollar funds from their account, they may do so by converting U.S. dollar funds to stablecoin or other digital assets, which can subsequently be withdrawn," the email said.
In early June, the firm suspended dollar deposits, saying the U.S. Securities and Exchange Commission's (SEC) "extremely aggressive and intimidating tactics" against the crypto industry had left banking partners reluctant to engage with the sector.
In the same message, Binance.US warned customers that its banking partners were preparing to pause dollar withdrawals as early as June 13.
The SEC sued Binance.US, the firm's international arm Binance and its founder Changpeng "CZ" Zhao, on June 5 for allegedly operating unregistered securities platforms. The SEC has since questioned the company' custody practices and willingness to cooperate in legal requests.
Binance last month lost its euro payments partner as well, with a replacement yet to be announced.
Monday's terms of use update also said U.S. dollar funds in Binance.US wallets are no longer protected by deposit insurance provided by the Federal Deposit Insurance Corporation (FDIC).
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Sandali Handagama is CoinDesk's deputy managing editor for policy and regulations, EMEA. She does not own any crypto.