Binance halts USDC withdrawals amid $1.9bn outflow

Due to massive withdrawals from Binance, the crypto exchange paused USDC withdrawals. However, Changpeng Zhao states that the decision is temporary.

On Dec. 13, Binance announced that it had temporarily paused withdrawals of USDC, a dollar-pegged stablecoin, due to a token swap. The company stressed that USDT and BUSD withdrawals remained intact.

Changpeng Zhao, Binance’s CEO, stated on Twitter that there were massive withdrawals on the stablecoin from the exchange. However, he claimed that the stablecoin would be available again after the banks in New York opened.

On USDC, we have seen an increase in withdrawals. However, the channel to swap from PAX/BUSD to USDC requires going through a bank in NY in USD. The banks are not open for another few hours. We expect the situation will be restored when the banks open. 1/2

— CZ 🔶 Binance (@cz_binance) December 13, 2022

According to a recent report by data firm Nansen, the number of withdrawals from Binance in the past 24h comprised $1.9 billion. The turmoil came after the news of the proof-of-reserves (PoR) spread panic among investors.

The crypto community is on edge due to concerns about further industry contagion following the collapse of FTX and the arrest of its former CEO, Sam Bankman-Fried.