Bitcoin (BTC) experienced a price dip on Binance.US early Friday, after the exchange declared its intentions to transition into a crypto-only platform starting June 13. At 08:25 UTC, the bitcoin-U.S. dollar pair on Binance.US was trading at a minimum of $130 below prices on other major exchanges like Coinbase, as observed by TradingView. As Clara Medalie, a director at the Paris-based crypto data provider Kaiko, pointed out, “BTC now trades at a slight discount on Binance.US”.
This decline in price stems from the increasing urgency among traders to liquidate their assets on the exchange, spurred by concerns over the halt in USD withdrawals. Binance.US announced late Thursday that it would cease acceptance of dollar deposits, and warned that banking partners were preparing to pause fiat withdrawal channels as of June 13. Clients were advised to reclaim their dollars via bank transfers prior to this date. Delisting of dollar-denominated pairs is slated to commence next week.
Binance.US’s decision follows the U.S. Securities Exchange and Commission (SEC) calling on a federal court to freeze the exchange’s assets. The SEC has accused Binance’s global entity and competitor Coinbase of violating federal securities law. This move has resulted in market makers withdrawing liquidity from Binance.US’s order books and subsequently worsening market depth. At one point, bitcoin even traded at a premium of over $1,000 on the exchange.
However, the negative price spread early Friday signals a change in direction following Binance.US’s announcement of the suspension of USD deposits and withdrawals. This raises concerns over the impact for traders, particularly how they are scrambling to exit the exchange and the subsequent effect on the value of their assets.
On the other hand, the transition to a crypto-only platform may open new opportunities for Binance.US. With the delisting of U.S. dollar-denominated trading pairs and a focus on purely crypto transactions, the platform could tap into a more niche market. However, the SEC’s actions and liquidity concerns indicate that the exchange may face an uphill battle in rebuilding trust and regaining market share.
While the current situation presents challenges for traders, it also serves as a reminder of the importance of scrutinizing the stability and security of exchanges before choosing to invest. Ensuring due diligence and understanding the risks associated with trading on various platforms can lead to better protection of one’s assets, even in the face of potential setbacks.
Source: Coindesk
