Binance.US Faces Banking Cutoff After SEC Showdown – Coinpedia Fintech News

“Binance.US Faces Imminent Banking System Cutoff”

In a groundbreaking legal development, Binance.US, the American arm of the renowned global cryptocurrency exchange, Binance, is on the verge of being cut off from the traditional banking system. This move comes in the wake of an aggressive lawsuit filed by the U.S. Securities and Exchange Commission (SEC) against the exchange.

Binance.US email to customers, stating that its payment and banking partners have signaled an intent to pause US dollar fiat channels as early as June 13. 

That means “our ability to accept USD fiat deposits and process USD fiat withdrawals will be impacted,” the company said “We are taking these proactive steps as we–for a time–transition to a crypto-only exchange. To be clear, we maintain 1:1 reserves for all customer assets”.

Binance.US, which tweeted the email, said it’s “suspending USD deposits and recurring buy orders today” and transitioning to a “crypto-only exchange.

“SEC Freezes Binance.US Assets, Demands Customer Fund Repatriation”

On Monday, after months of discussions, threats, and warnings, the US Securities and Exchange Commission (SEC) alleges that Binance and its founder Changpeng ‘CZ’ Zhao operated as an unregistered securities exchange, misleading investors & regulators, and breaking securities rules. The agency subsequently said it’s seeking to freeze Binance.US’s assets and protect customer funds, including through the repatriation of client investments held abroad.

In its counterpart, Binance.US in the email to customers said the SEC’s allegations are “unjustified” and that “we will continue to vigorously defend ourselves.”

Later the platform said it will delist trading pairs involving the US dollar starting next week but continue to support pairs involving stablecoins — tokens that are supposed to hold a constant value, typically $1.

However, Binance.US has expressed its commitment to cooperating with regulatory bodies and has taken steps to ensure compliance with the evolving legal landscape.

While uncertainty looms over the future of Binance.US, it is essential to remember that regulatory challenges often serve as catalysts for innovation and the establishment of best practices. 

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