1. Binance’s banking partner is reportedly set to start ignoring transactions under $100K due to a recent FDIC statement and the implosion of FTX.
2. The FDIC has declared that offering crypto products and services is considered a high-risk activity by traditional banks.
3. Crypto markets have been showing strong signs of recovery, but financial institutions are understandably on their guard.
Binance, one of the world’s largest cryptocurrency exchanges, is reportedly facing an issue with its banking partner. The partner will start ignoring transactions under $100K, according to a recent report. This decision is reportedly taken due to a recent statement made by the Federal Deposit Insurance Corporation (FDIC) which declared that offering crypto products and services should be considered a high-risk activity by traditional banks.
The report noted that the banking partner of Binance had recently provided services for FTX, a crypto derivatives exchange. However, FTX imploded and is now facing legal action from its customers. This, along with the FDIC’s statement, has caused the banking partner to be more cautious with its services.
This is not the first time that Binance has faced issues with its banking partner. Recently, the exchange had to suspend deposits in Euros due to issues with its banking partner. The exchange has been actively searching for a new banking partner since then.
Crypto markets have been showing strong signs of recovery in the past few weeks. Bitcoin, the largest cryptocurrency, recently reached a new all-time high of over $42,000. The recent surge in prices has been driven by institutional investors who have been investing in the digital asset. However, financial institutions are understandably on their guard due to the volatile nature of the markets.
The report also noted that Binance is not the only exchange facing issues with its banking partner. Other exchanges are also facing similar issues due to the FDIC’s statement. This could lead to more exchanges suspending deposits and withdrawals in certain currencies.
It remains unclear how this will affect the crypto industry in the long term. However, it is clear that banks are becoming more cautious with their services when it comes to crypto. This could lead to more exchanges struggling with banking issues in the future.