Binance.US halts USD deposits due to SEC’s ‘witch-hunt’.

Binance.US has informed its customers that they may not be able to purchase cryptocurrencies using their US dollars from June 13th. The announcement made on Thursday came after the Securities and Exchange Commission (SEC) filed a lawsuit against the exchange and its founder, Changpeng Zhao (CZ), on Monday.

The SEC claims that Binance has violated the country’s securities laws. However, the exchange argues that the regulator is making “unjustified civil claims” against its business.

The official statement reads:

“Today we are suspending USD deposits and notifying customers that our banking partners are preparing to pause fiat (USD) withdrawal channels as early as June 13, 2023.”

Binance.US to Lose Access to US Banking System

Currently, the SEC is seeking to freeze Binance.US’ assets. However, interestingly, the regulator has also taken customers into account, requesting the court to approve a temporary restraining order. This is to allow the exchange to continue processing withdrawal requests for the time being.

Nevertheless, the regulatory pressure has made it difficult for Binance.US’ banking partners to work with the exchange. This is why the so-called banking partners have “signalled their intent to pause USD fiat channels” from as early as next week.

Binance has advised its customers to take appropriate action with their USD. The exchange also reassures them that their funds are safe, even if they are unable to withdraw their money by the due date. They can still convert it to a stablecoin such as Tether (USDT) and withdraw that. Afterward, they can convert the stablecoin back to dollars elsewhere.

The exchange has suspended customers’ ability to buy and deposit US dollars as a preemptive measure.

Transition in Progress?

The proactive measures taken by Binance.US to stop customers from buying and depositing US dollars may have positioned it as a crypto-only exchange. However, this may only be until the SEC case is resolved.

Currently, Binance.US has taken other measures to ensure that its US-focused platform continues to function even without the banks. The exchange has also announced the delisting of ten different trading pairs in light of the ongoing lawsuit.