Binance.US, the American counterpart of the global cryptocurrency exchange Binance, has taken a significant step amidst increasing regulatory pressure. In response to a lawsuit filed by U.S. regulators against Binance and its CEO, Changpeng Zhao, the exchange has decided to suspend U.S. dollar deposits and is preparing to limit fiat dollar withdrawals from as early as June 13. This move is part of Binance.US’s proactive measures as it transitions to operating solely as a cryptocurrency exchange for the time being. Despite the changes, users will still have access to trading, staking, and crypto-related transactions on the platform.
The regulatory actions against Binance.US and other major cryptocurrency platforms mark a noteworthy escalation in the crackdown by U.S. regulators on the crypto industry. Earlier, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance and subsequently sued Coinbase, the largest cryptocurrency platform in the United States. Additionally, U.S. financial regulators expressed support for freezing Binance’s assets, as disclosed in a public filing made by the SEC to a federal court.
Matthew Dibb, the COO of Singapore-based crypto platform Stack Funds, commented on the situation, stating that Binance.US is relatively smaller compared to its international counterpart. He emphasized that the suspension of withdrawals is likely to cause concern and panic among users. However, considering the ongoing comments and issues from regulators over the past week, the developments were somewhat anticipated.
The news of the deposit suspension did not have a significant impact on cryptocurrency prices. Bitcoin, for example, experienced only a marginal decrease to $26,496 during Asian trading on Friday, with a weekly loss of approximately 2%. Binance’s native token, BNB, also saw a slight decline of 0.46%, reaching $261.46.
Market analyst Tony Sycamore of IG Markets noted that the reaction from the market has been relatively muted so far, suggesting that it has either shrugged off the news or is still processing the implications.
In response to the SEC’s stance, Binance.US expressed in a tweet that the regulatory body’s approach to cryptocurrencies is “extremely aggressive and intimidating.” The exchange vowed to vigorously defend itself, its customers, and the industry against what it referred to as “meritless attacks” from the SEC.
Following the lawsuits, the crypto industry has criticized SEC Chair Gary Gensler. However, Gensler has rejected the notion that the agency intends to suppress the crypto industry. Wayne Huang, the Co-founder and CEO of XREX Inc, a blockchain-enabled financial institution operating the XREX USD-crypto exchange, believes that as regulatory scrutiny continues, exchanges, stablecoin issuers, and other industry players will specialize in different roles to collectively enhance the user experience.