Key Points:
- As the bank reduces its exposure to digital-asset markets, Binance, the biggest cryptocurrency exchange in the world, announced that Signature Bank would only accept user transactions of more than $100,000.
- Users of bank accounts holding U.S. dollars who want to purchase or sell cryptocurrencies for less than $100,000 over the SWIFT payment system will be affected by the service interruption.
On-ramp and off-ramp bank money transfers may be halted due to a service outage, which Binance has warned its retail client base about.
Users of bank accounts holding U.S. dollars who want to purchase or sell cryptocurrencies for less than $100,000 over the SWIFT payment system will be affected by the service interruption. On February 1, the disruption will start to happen.
On January 21, Binance emailed its users to share the news, emphasizing that they are currently actively seeking a new SWIFT partner to prevent service interruptions for upcoming bank payment transfers.
The cryptocurrency exchange said that this was a Signature Bank decision and that other trading platforms will also be impacted by the shift in addition to Binance:
“One of our fiat banking partners, Signature Bank, has advised that it will no longer support any of its crypto exchange customers with buying and selling amounts of less than 100,000 USD as of February 1, 2023. This is the case for all of their crypto exchange clients. As a result, some individual users may not be able to use SWIFT bank transfers to buy or sell crypto with/for USD for amounts less than 100,000 USD,” Binance said in a statement sent to Bloomberg News on Saturday.
No additional banking partners are active, according to Binance. Financial institutions utilize the SWIFT network to send information and commands.
Fears of a financial contagion in the market for digital assets have spread to traditional lenders like Signature and Silvergate Capital, the top 2 borrowers at Federal Home Loan Banks.
New York-based Signature said that it planned to withdraw up to $10 billion in customer deposits for digital assets as part of a general withdrawal from the cryptocurrency market following the collapse of FTX.
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Coincu News
