Scary news for Binance users: crypto on/off ramps will be closed by Feb 1st
Ok, so, on the surface this story seems like a total corporate-banking-flavored snooze fest...
But so did The Big Short, and it won an Oscar!
Here's what's happening:
Binance's SWIFT banking partner is set to ban USD transfers below $100K.
Ok...what does that mean, exactly?
As of Feb 1st, if you're transferring crypto from Binance, to your USD-based bank account (or vice versa), you'll only be able to make the transfer if it's for $100K+.
(I.e. Want to convert $1000 worth of Bitcoin into USD and transfer it to your bank account? Not an option as of February).
Some things to note are:
Credit and debit card payments won't have the same restrictions.
Binance's banking partner will be doing this with all crypto exchanges that it services, not just Binance.
Binance are “actively seeking” a new SWIFT partner to avoid service disruptions.
Here's where this change becomes a BIG problem:
Centralized exchanges, like Binance, are the on/off ramps for the crypto world.
(I.e. If you want to convert your crypto into cash - these exchanges are the only real option).
If another banking partner cannot be found to serve the affected exchanges, then anyone with:
A USD-based bank account.
Less than $100K worth of crypto.
Won't be able to get their money out.
Why is this happening?
It hasn't been made clear just yet...
But this feels like it might be a pre-cursor to the introduction of Central Bank Digital Currencies (CBDC's) - aka government run stablecoins.
Essentially, giving them a logical reason to exist, by giving them a problem to solve. Going a little something like this:
Create a problem (stop everyday retail investors from being able to cash out crypto) → provide a solution (make CBDCs the only way to cash out under $100K) → drive adoption.
If this is all feeling a little tin-foil-hat-ish, you're absolutely right.
Now, let's jump down this rabbit hole
