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Binance U.S. Arm Searching for Bank Partner After Signature Bank Failure

The U.S. subsidiary of cryptocurrency exchange Binance is facing difficulties finding a bank to manage its customers' cash, following the failure of Signature Bank last month, according to the Wall Street Journal.

Binance logo
Binance logo

Crypto-Friendly Banks Fail, Leaving Binance US Scrambling

Previously, Binance.US relied on either Signature Bank or Silvergate Capital for deposits, as both were considered crypto-friendly banks. However, with the failure of both banks, Binance.US is now urgently seeking a new banking partner.

Binance U.S. Turns to Intermediary to Store Funds

Binance U.S. is currently using at least one intermediary to hold its customers' funds, which could result in slower transactions due to the involvement of a third party.

Reluctant Banks Cite Regulatory Risks

Attempts to establish relationships with Cross River Bank and Customers Bancorp have yet to be successful, as banks are hesitant to partner with Binance U.S. due to concerns over regulatory risk.

Binance U.S. Continues Working with Multiple U.S. Banking Partners

Despite these challenges, a Binance U.S. spokesperson stated they are working with multiple U.S.-based banking and payment providers, onboarding new partners, and upgrading internal systems for a more stable fiat platform and additional services.

CFTC Lawsuit and Investor Withdrawals Impact Binance

Last month, the U.S. Commodity Futures Trading Commission (CFTC) sued Binance, its CEO, and former top compliance executive, accusing them of operating an illegal exchange and a sham compliance program. Following the lawsuit, investors withdrew $1.6 billion from Binance.