Clients of one of the banks facilitating Fiat operations at Binance will no longer be able to trade crypto through SWIFT transfer for less than $100,000. This transaction minimum, aimed at reducing exposure to digital assets, will be introduced by the financial institution in February.
Banks working with Binance will set a $100,000 transaction minimum for crypto traders
Banks serving some customers of Binance, the world’s largest cryptocurrency exchange, will only process customer transactions over $100,000 starting February 1. The new minimum amount will be imposed as part of the lender’s decision to limit exposure to the digital asset market.
“Signature Bank, one of our Fiat Bank partners, has informed us that they will not support any of their crypto exchange clients with trading amounts under $100,000 beginning February 1, 2023. This is the case for all their crypto exchange clients,” Binance said in a statement shared with Bloomberg on Saturday, elaborating.
As a result, some individual users may not be able to use SWIFT bank transfers to buy and sell crypto with/for USD in amounts less than USD 100,000.
This measure concerns retail traders with accounts serviced by Signature, and the exchange assured customers that it is actively looking for new partners for SWIFT transfers in USD. SWIFT is the most widely used global system for interbank transfers. SWIFT is the most widely used global system for interbank transfers.
Only 0.01% of Binance’s monthly users are serviced by Signature Bank, and no other banking partners are affected, the crypto firm noted through a spokesperson. Card payments and non-USD transfers are not affected.
The news comes after New York-based Signature Bank revealed in December that it plans to shed up to $10 billion in deposits from its digital asset customers as it exits the crypto industry. The move was announced in the aftermath of the collapse of FTX, one of Binance’s main competitors, which filed for bankruptcy protection in November amid liquidity problems.
Traditional finance firms have been hit by fears of contagion during a turbulent year for the crypto space, with prices falling and many crashing. Silvergate Capital, the parent company of California’s Silvergate Bank, which handles crypto transactions, lost 40% of its stock after customers withdrew more than $8 billion in digital asset deposits in the fourth quarter of 2022.
Signature’s shares fell 64% last year, the report noted. That decision came after the FDIC issued a warning about the risks associated with crypto assets. Business models focused on crypto-related activities, or exposing the crypto asset market, raised safety and soundness concerns, the regulator said in a statement released in early January.
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