Dubai-based cryptocurrency exchange Bybit has announced that it is suspending USD deposits and withdrawals through bank transfers from the 10th of March, 2023.
The world’s fourth-largest cryptocurrency exchange by volume stated that the transfers were being suspended due to service outages from a partner. However, it did not name the partner in question.
Bybit Becomes Latest Exchange To Suspend USD Transfers
One of the largest cryptocurrencies in the world, Bybit, has announced that it would be temporarily suspending USD deposits through bank transfers due to “service outages from a partner.” It stated that funds can be withdrawn via wire transfers until the 10th of March, 2023. The firm stated in a blog post that USD deposits via Wire Transfer (SWIFT) and Wire Transfer (US Banks) would no longer be available.
“We have temporarily suspended USD deposits via Wire Transfer (including SWIFT) due to service outages from our end-point processing partner until further notice. If you wish to make any withdrawals via these methods, please do so before the 10th of March, 2023, 12 AM (midnight) UTC.”
However, it gave users an alternative, stating that they could continue making USD deposits through their credit card or the Advcash Wallet.
“You may continue to make USD deposits via the Advcash Wallet or buy cryptocurrencies with your credit card on our One-Click Buy page.”
The Dubai-based exchange also assured users that all USD assets held with Bybit are secure.
“Our platform has undergone strict security measures to ensure the safety of all user funds.”
It is worth pointing out that the world’s largest cryptocurrency exchange, Binance, had also made an announcement stating that it was temporarily suspending USD withdrawals and deposits for its international customers.
Possible Link To Silvergate?
The Bybit announcement comes after Silvergate Bank announced that it was shuttering its digital assets’ payment network, calling it a “risk-based decision.” Silvergate’s payment network was used by a number of crypto firms and served as a major on-and-off ramp for USD in the crypto space. Silvergate has also been facing several issues, with the firm stating in a filing that it would not be able to meet the 16th March deadline for filing its 10-K report with the Security and Exchange Commission due to a number of regulatory and business challenges.
It also added that it was evaluating “its ability to continue as a going concern,” resulting in a number of cryptocurrency platforms severing ties with the embattled bank. Silvergate was one of the banks providing banking services to the Sam Bankman-Fried-led FTX and posted a loss of $949 million, according to its earnings report.
Banks Reducing Exposure To Crypto
The unprecedented collapse of the cryptocurrency exchange FTX and its crippling impact has understandably invited the scrutiny of regulatory agencies in the United States. As a result, banks and other financial institutions are under tremendous pressure to reconsider and limit their exposure to cryptocurrencies and digital asset companies. Moonstone Bank, a digital bank that focuses on providing services to high-net-worth individuals, announced that it was exiting the crypto space entirely. It stated that it would be refocusing on fulfilling its role as a “community bank.” Moonstone stated that recent developments in the crypto space, coupled with increased regulatory scrutiny, played a major role in its decision. Moonstone stated at the time,
“The change in strategy reflects the impact of recent events in the crypto assets industry and the resultant changing regulatory environment relating to crypto asset businesses.”
In the same vein, Signature Bank, Binance’s banking partner, is also looking to reduce its exposure to crypto and the cryptocurrency ecosystem. Recently, the bank announced that it was raising the transaction minimums for dollar transfers and would be processing trades only with those accounts that held over $100,000.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.