Crypto Exchange Bybit Suspends USD Deposits

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Crypto exchange Bybit announced on Saturday a suspension of U.S. dollar (USD) deposits for national and international customers.

"We have temporarily suspended USD deposits via Wire Transfer (including SWIFT) due to service outages from our end-point processing partner until further notice," the exchange said, adding that withdrawals will be stopped from March 10.

Users, however, can continue to deposit and withdraw crypto to and from wallet addresses and fund purchases through credit cards and other payment methods.

"The payment gateway interruption is limited in scope and does not involve other fiat or cryptocurrencies and/or account funding channels. Users can still buy cryptocurrencies in USD using their debit and credit cards through other channels. We are closely urging our partners for alternative solutions and will keep our users and stakeholders posted as soon as there are further developments," Bybit's spokesperson told CoinDesk.

Bybit's move comes a month after Binance, the world's largest digital assets exchange by trading volume, halted dollar transfers and amid a crisis at Silvergate, a California-based lender famous for offering traditional banking services to crypto firms, including exchanges. Last week, Silvergate said it's evaluating "its ability to continue as a going concern" and delayed filing its annual report with the Securities and Exchange Commission.

According to Markus Thielen, head of research and strategy at crypto services provider Matrixport, Bybit's decision to follow Binance's lead amid the Silvergate crisis is a big deal for the crypto market.

"When Binance halted USD transfers in January, bitcoin prices dropped -10%. Obviously, Binance has a much bigger impact than other exchanges but also now ByBit will halt USD transfers from March 10 onwards. This action is now preventing SWIFT (international) and Wire transfers (national) to reach some crypto exchanges and is indeed a BIG deal," Thielen said in a note to clients.

"Three data points certainly make a trend that there is a deliberate attempt to cut off USD access for crypto exchanges and crypto firms," Thielen added.

CORRECTION (March 6, 2023, 08:46 UTC): Corrects to say Silvergate, not Bybit, is evaluating its situation in fifth paragraph.

UPDATE (March 6 08:52 UTC): Adds comments from Bybit's spokesperson in the fourth paragraph.