Binance users in Australia now have a limited number of options to buy cryptocurrency amid the ongoing global unbanking of crypto firms. As of June 1 at 5:00 p.m. local time, fiat access and exit via bank transfer is interrupted in Australia. The suspension includes trading in Australian Dollar (AUD) pairs.
The stopping of deposits and withdrawals is linked to earlier developments that impacted Binance in Australia. In February, the local derivatives arm of Binance abruptly informed its users that certain positions and accounts would be closed for those who did not meet the conditions to be considered wholesale investors.
We regret to inform you that deposits and withdrawals in AUD via bank transfer are no longer available for Binance users in Australia. Binance ceased all AUD trading pairs effective June 1. In order to facilitate withdrawals and trading activities after June 1st, you…
— Binance Australia (@Binance_AUS) June 1, 2023
By law, a wholesale investor is an experienced investor with the capital to invest in high-quality assets, which generally involves higher risks. This type of investor may also be referred to as an institutional or accredited investor. To be classified as a wholesale investor in Australia, one must have net assets of at least $2.5 million or an annual gross income of at least $250,000.
After Binance removed non-compliant accounts, local regulators launched a “targeted review” of the exchange’s local derivatives operations. On April 6, the Australian securities regulator revoked the Binance Australia Derivatives license.
A few weeks later, in May, Binance Australia announced that it had suspended AUD services after its local payment service provider Zepto was instructed to do so, ceasing all bank transfer deposits and withdrawals.
At that time, a spokesperson for Zepto told Cointelegraph that its partner Cuscal had asked the company to “pull out of Binance.” In a separate statement, Cuscal said it was only “to protect Australians from financial crime and scams”.
Since then, Binance Australia has been looking for a payment provider. In the US, Binance.US faced a similar challenge when former partners Silvergate and Signature Bank were shut down amid the banking crisis earlier this year.
“We are working hard to find an alternative provider to continue offering AUD deposits and withdrawals to our users,” a Binance spokesperson told Cointelegraph in a statement, adding that users in the country can still buy and sell. cryptos using credit or debit cards and peer-to-peer commerce continues to operate as usual. Additionally, remaining AUD balances on accounts have been converted to Tether (USDT).
The ongoing cross-border unbanking of crypto firms prompted Binance CEO Changpeng “CZ” Zhao to consider buying a bank, he revealed in an interview.
Although some have warned that risks still exist, Australia-based cryptocurrency exchanges have lined up to ease contagion fears in the wake of recent events. “It reflects the regulatory environment in which we operate or, in this case, the lack of a regulatory environment,” said Caroline Bowler, CEO of BTC Markets.
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