Dubai-based crypto exchange Bybit has temporarily suspended USD deposits via bank transfers due to “service outages from a partner”. Customers can still withdraw funds through wire transfers until March 10. Bybit CEO Ben Zhou assures that users’ funds are safe and secure in separate accounts, and the halt does not affect its earn products.
Bank Transfer Deposit Suspension and Alternative Options
In a blog post released on March 4, Bybit announced the suspension of USD deposits via Wire Transfer (SWIFT) and Wire Transfer (For US bank). The halt does not affect users’ Advcash Wallet or credit card deposits. The exchange also noted that withdrawal through Advcash Wallet is scheduled to be available soon. Bybit encourages clients to withdraw their USD funds as soon as possible to avoid potential disruptions.
Bybit has an exposure of $150 million through its investment arm Mirana Asset Management to crypto lender Genesis Global Trading, which filed for Chapter 11 bankruptcy on January 20. However, Bybit’s CEO Ben Zhou stated that $120 million of the exposure was already collateralized and liquidated. Zhou assured that all client funds are in separate accounts, and that the halt in USD deposit does not affect its earn products, which do not use Mirana.
US Bank’s Risk-Based Decision to Reduce Crypto Exposure
The halt in USD deposits through bank transfers comes amid regulatory pressure and market outflows following the collapse of cryptocurrency exchange FTX in November 2022. Silvergate bank also announced the discontinuation of its digital assets’ payment network, which was one of the major on- and off-ramps for USD in the American crypto industry. US banks are reducing their exposure to cryptocurrency assets due to risk-based decisions.
Bybit’s temporary suspension of USD deposits via bank transfers may cause potential disruptions. However, the exchange has offered alternative options for users to deposit and withdraw funds. Bybit’s exposure to Genesis Global Trading is also under control, and all client funds are safe and secure in separate accounts. The halt comes amid US banks’ risk-based decisions to reduce exposure to cryptocurrency assets, causing major on- and off-ramps for USD in the American crypto industry to discontinue.
