Binance EU Users Face Fiat Withdrawal Issues – What’s Going On?

Some Binance customers in the EU have been blocked from withdrawing euros as part of an early change in the crypto exchange’s regional payments provider looms.

Several users in the region have been denied access to Paysafe, Binance’s European payments partner, ahead of the September 25 deadline, when the payments company is set to end support for the exchange’s customers.

One user Ervin Ursic has reportedly said that he’d sent some ether (ETH) to his account on September 12 and sold it for euros, but was unable to withdraw the funds. 

Instead, the user faced a pop-up message that his account had been closed early with no prior warning. 

“As a high-frequency Paysafe service user, Paysafe closed your account early to speed up this process. Any remaining EUR/GBP in your account can be withdrawn once the review is completed,” the message titled “Paysafe Notification” said.

In a comment to Cryptonews.com, a Binance spokesperson said that Paysafe has put “a very small portion (0.085%) of Binance users with Paysafe accounts in Europe through an earlier closure review.”

“As a result, Paysafe will delay withdrawals for affected users. Once Paysafe completes their review, affected users should be able to withdraw funds via bank transfer.”

The spokesperson added that Binance has offered VIP upgrade vouchers to affected users “in recognition of the inconvenience imposed on our users by Paysafe.”

In a Friday statement, Paysafe said it “cannot speculate in the media on why this particular customer is unable to make transactions and it is Binance who holds the relationship with the customer not Paysafe.”

The statement added that Paysafe services for Binance customers “are fully operational with our contractual and regulatory obligations.”

Paysafe Discontinues Deposits and Withdrawals For Binance 

Paysafe facilitated fiat deposits and withdrawals for Binance users in Europe, including through bank transfers within the EU’s Single Euro Payments Area (SEPA). 

However, in June, the payments provider announced that is winding down support for its embedded wallet service for Binance’s EU customers following a strategic review. 

This decision came after Paysafe had already withdrawn support for the British pound for new Binance users in May.

Binance has been under heightened regulatory scrutiny globally since the market turbulence of the previous year.

Back in June, the SEC sued Binance and its CEO for their “blatant disregard of the federal securities laws,” unveiling 13 charges against the platform, including operating an unregistered exchange.

The agency accused Binance of breaking the law by offering unregistered securities to the general public, including its BNB token and BUSD stablecoin.

Likewise, French authorities conducted a visit to Binance’s office in France last month. They are investigating allegations of illegal provision of digital-asset services and aggravated money laundering.

The exchange was also ordered to cease operations in Nigeria by the country’s Securities and Exchange Commission (SEC).

Binance has also faced regulatory challenges in multiple European countries, such as Belgium and Austria, as it prepares to comply with the EU’s forthcoming Markets in Crypto Assets (MiCA) regulations.

The regulatory pressure has caused Binance’s market share to shrink by 25% during the period between February to June.