CryptoCurrency

Binance US Struggles to Discover Banking Associate

Binance US’s financial troubles
Following the failure of Signature Bank and Silvergate Bank, the US division of global cryptocurrency exchange Binance is having difficulty finding a banking partner, according to a Wall Street Journal story.

In order to hold cryptocurrency merchant deposits on the platform, Binance US is currently using the services of at least one intermediary bank while searching for a major banking partner. When a consumer uses an intermediary bank instead of a direct banking partner, exchange services such as US currency deposits and withdrawals are delayed.

Previously, Binance US relied on its exclusive US banking partners, Silvergate Bank and Signature Bank, for customer deposits. But last month, Silvergate, a bank that supported cryptocurrencies, announced voluntary liquidation, while Signature Bank was placed into FIDC administration.

According to the report, Binance US attempted in vain to obtain the direct banking services of multiple lenders, such as Cross River Bank, located in New Jersey, and Clients Bancorp Inc., a regional bank situated in Pennsylvania.

“We work with multiple U.S.-based banking and payment providers and continue to onboard new partners while upgrading our internal systems to create a more stable fiat platform and offer additional services,” stated a spokesman for Binance US.

Prime Trust LLC is a financial technology and cryptocurrency services company that Binance US currently employs to store customer funds. Prime Trust verified through its network of banking partners that it deposits the customer’s funds.

Because it is “transitioning to new banking and payment service providers over the next several weeks,” the exchange is also having problems with USD deposits and withdrawals. While wire transfers have been restored, debit card, Apple Pay, and Google Pay services are not available.

Binance’s issues in the US
The biggest cryptocurrency exchange by trading volume, Binance, is currently dealing with intense regulatory pressure in the US. The CEO of Binance, Changpeng Zhao, was sued by the Commodities Futures Trading Commission (CFTC) last month for a number of regulatory infractions.

The Securities and Exchange Commission (SEC) and the Justice Department are purportedly looking into the exchange; however, no charges have been brought against it as of yet.

Outside of the US, Binance’s activities are encountering difficulties as well. Recently, Oztures Trading Pty Ltd’s Binance Australia Derivatives lost its Australia Financial Services (AFS) licence. The withdrawal was requested by Binance, but it was made during a regulatory hearing.

In the meantime, Binance has extended its services to include direct cryptocurrency trading on the exchange using local pesos in inflation-stricken Argentina.

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