Paysafe Stops Processing Binance Users' Euro Deposits As Exchange's Woes Mount

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Paysafe stopped processing euro deposits for Binance customers, adding to a series of problems for the world’s biggest crypto exchange.

Binance advised its European users to convert their euro holdings into Tether (USDT) by the end of October.

“As Paysafe unilaterally decided to stop processing EUR deposits for Binance users, Paysafe users are advised to take appropriate actions in advance,” the exchange said.

This is an important announcement impacting some EUR / Paysafe users. There should also be replacement fiat channels going live soon. Please stay tuned. 🙏

Important Updates for Paysafe Users | Binance Support https://t.co/9XoF4olkjN

— CZ 🔶 BNB (@cz_binance) September 28, 2023

This unexpected move has disrupted several services that Binance offers to its European user base, it said

Euro deposits were suspended on Sept. 25, causing an immediate halt to users’ ability to deposit euros into their Binance accounts. The ability to buy or sell cryptocurrencies using euro balances on the platform also ceased as of Sept. 28, although users can still use credit or debit cards for euro-based cryptocurrency purchases, it said.

Binance Spot Trading Service Affected

Paysafe’s decision has also affected Binance’s spot trading services. Starting from Sept. 28, all Paysafe users are unable to trade euro spot trading pairs on the platform. Any open orders on these pairs were also scheduled to be canceled, it added.

The impact extends to Binance’s trading bots, with the exchange terminating Spot Trading Bot services on specific euro trading pairs. The company highlighted that users relying on these bots are advised to update, or cancel their setups to prevent potential losses.

The way Binance Convert works has also been changed. From Sept. 28, it will operate in “EUR reduce only” mode. This means users can convert euros to other cryptocurrencies through market orders, but they won’t be able to open new euro limit orders.

For users participating in Binance Auto-Invest plans with euros, these plans will be paused from the same date. Subscriptions won’t be possible for Paysafe users moving forward. However, Auto-Invest services for euros remain unaffected for other users.

Binance has assured its users that their funds are secure, and other cryptocurrency-related services on the platform remain operational. The exchange is also actively working on onboarding new partners to address these challenges.

Back in late August, Binance customers had already encountered difficulties with withdrawing regular currency in Europe. During that time, the company disclosed that it had suspended euro withdrawals and deposits via SEPA due to its inability to support these transactions without a payment provider.

This statement was prompted by an European Binance user who claimed to have recently purchased a substantial amount of euros on the platform. This user expressed frustration over an inability to withdraw the euros to a bank account or sell them on Binance due to the closure of a Paysafe account.

I bought a large amount of EUR on Binance a few days ago. Now, I can't withdraw it to my bank account nor sell it again on Binance, because "my Paysafe account has been closed early". What is this scam? Don't hold my EUR hostage, wtf@cz_binance @binance @BinanceHelpDesk #Binance pic.twitter.com/DoXnTU4MZR

— Nesh (@Nesh61401966) August 20, 2023

Paysafe’s Evolving Relationship with Binance

Paysafe had earlier warned of its plan to suspend euro deposits on Sept. 25. The firm had previously been facilitating the deposit and withdrawal of regular currency for Binance users in Europe, including through bank transfers in the European Union’s Single Euro Payments Area (SEPA).

However, in June, the payment provider announced it would no longer offer its embedded wallet to Binance’s EU customers, following a “strategic review” of their partnership. This decision came after Paysafe had already withdrawn support for the British pound for new Binance users back in May.

Binance Facing Increased Regulatory Scrutiny Globally

Binance is facing increased scrutiny from regulators worldwide, particularly following the market turbulence of the previous year, which exposed mismanagement of customer funds and regulatory issues in various prominent cryptocurrency enterprises such as Sam Bankman-Fried’s FTX.

The exchange has also made the decision to withdraw from operating in the Netherlands and Cyprus, and requested the cancellation of their permissions in the UK.

We regret to announce that Binance is leaving the Dutch market as we have been unable to register as a VASP with the Dutch regulator.

We continue to be committed to working collaboratively with regulators around the world and are additionally focused on getting our business…

— Binance (@binance) June 16, 2023

Belgium’s market watchdog issued an order for the exchange to cease offering cryptocurrency services in the country.

In a recent move, its subsidiary Binance Markets Limited (BML), decided to cancel its registration with the Financial Conduct Authority (FCA) in the United Kingdom.