- Binance users in the U.S. are experiencing difficulties withdrawing funds to banks.
- While Binance claims it’s due to banking disruptions, users and critics are skeptical.
- The issue arose after Binance found itself in a legal dispute with the CFTC.
Binance, one of the largest cryptocurrency exchanges in the world, is experiencing disruptions in withdrawals to banks in the U.S.
According to a Wednesday Twitter post from Binance, the exchange paused deposits and withdrawals “for a small subset of users.”
Binance cited “recent banking developments” for the move, pausing withdrawals “out of an abundance of caution.” The exchange added that it expects to restore withdrawals for all users soon.
Binance Users Went Anger, Withdraw En Masse
Binance users were generally unhappy with that explanation. Many demanded their money immediately and vented their anger at Binance’s social media. Others advised Binance users to transfer their crypto to a different exchange and withdraw it from there.
Issues with off-ramping came after Binance saw a significant surge in the outflow of capital. On Monday, the exchange recorded $2 billion in outflows over seven days. The withdrawal spike comes after the exchange found itself in legal trouble with U.S. authorities.
The exchange faces a potentially fatal lawsuit from the U.S. Commodity Futures Trading Commission (CFTC). The lawsuit alleges that Binance allowed U.S. residents to trade derivatives without registering with the agency.
On the Flipside
- Binance’s troubles are mounting. On Wednesday, FT reported that Binance hid its ties to China for years after the exchange left the country.
- According to Binance’s CEO, Sam Bankman-Fried of FTX tried to discredit Binance with US regulators by pointing to its supposed Chinese ties.
Why You Should Care
The situation with Binance withdrawals highlights the potential risks of dealing with centralized crypto exchanges. Investors should always be mindful of who they give custody over their funds.
Sponsored
Read more about Binance’s potentially fatal CFTC lawsuit:
Binance Lawsuit Explained: Why CFTC Involvement Is a Big Deal
Read about the ongoing developments in FTX:
FTX Bankruptcy: OKX, Okcoin Will Return $165M in Frozen Assets
