Binance users in Australia now have fewer options for buying cryptocurrencies amid the continued debanking of the global crypto business. As of 5:00pm local time on June 1, Australia has stopped sending fiat money in and out of Australia via bank transfers. Trading suspensions include the Australian dollar (AU$) currency pair.
The closure of deposits and withdrawals is related to previous developments affecting Binance Australia. In February, Binance's local derivatives arm suddenly notified its users that certain positions and accounts would be closed for those who did not meet the requirements to be considered Wholesale investors. Wholesale investors are, by law, experienced investors with capital to invest in more speculative assets, which often carry higher risks. This type of investor may also be called an institutional investor or an accredited investor. To be classified as a wholesale investor in Australia, a person should have a net worth of at least $2.5 million or a gross annual income of at least $250,000.
After Binance shut down non-compliant accounts, local regulators launched a “targeted review” of the exchange’s local derivatives business. On April 6, the Australian securities regulator canceled Binance’s Australian derivatives license.
A few weeks later, in May, Binance Australia announced that it was suspending services in Australian dollars, halting all deposits and bank transfer withdrawals, after its local payment service provider Zepto was instructed. At the time, a Zepto spokesperson told Cointele graph that its partner Cuscal directed the company to “disengage from Binance.” In a separate statement, Cuscal said it was only “protecting Australians from financial crime and scams”.
Since then, Binance Australia has been on the lookout for payment service providers. In the US, Binance.US faces similar challenges after former partners Silvergate and Signature Bank were shut down during the banking crisis earlier this year. A Binance spokesperson told Cointelegraph in a statement that “we are working hard to find alternative providers to continue to provide our users with deposits and withdrawals in Australian dollars,” adding that users in the country can still buy and sell crypto using credit or debit cards currency, and peer-to- peer transactions continue as usual. Additionally, the remaining AUD balance in the account has been converted to Tether.
Binance CEO Changpeng “CZ” Zhao revealed in an interview that the ongoing cross-border de-banking of cryptocurrency companies has prompted him to consider acquiring a bank. While some have warned that risks remain, Australia-based cryptocurrency exchanges have drawn up long queues to allay fears of conflict following the latest incident. “It’s a reflection of the regulatory environment we’re in, or in this case, the lack therefore,” BTC Markets CEO Caroline Bowler noted.
