In recent times, Binance US has been making headlines for one reason or another. Now, Binance has caught attention as it is selling Bitcoin about $3,000 lower than the global spot prices.
On Sunday, a group of crypto users pointed out that Bitcoin is trading at a significantly lower price on Binance. These users also mentioned that there is a huge price discrepancy between cryptocurrencies listed on the crypto exchange and their global spot prices, with many calling it a “depeg” of cryptocurrencies.
Depegging is where the value of a stablecoin deviates significantly from its pegged value. For instance, if a USD-pegged stablecoin sustained a drop in value under $1, the coin is said to be depegged.
Notably, while across the globe Bitcoin has been hovering in $30,000 levels, data suggests that on Binance US it is is currently trading at $27,536. This is around an 8.5% discount from global spot USD prices of $30,106 at the time of writing.
Simultaneously, other cryptocurrencies are also trading at a discount in U.S. Dollar terms. Ethereum prices are around $200 cheaper on Binance.US, trading for $1,695 as the time of writing. Some stablecoins such as USDT were also trading below their pegs with Tether at $0.915 on the exchange.
Sources reveal that while these crypto discounts might look interesting for investors, the reality is that most investors will not be able to take advantage of them. Reportedly, such discounts can only be availed when a cryptocurrency is traded against fiat USD on the crypto exchange.
Now, in the case of Binance US, after being hit by the lawsuit from the United States Securities and Exchange Commission (SEC), the platform had announced to halt USD services. This suspension disabled users to deposit new USD into the platform. Hence, this means that the discounted cryptocurrencies can only be bought with any USD already sitting on the account before the suspensions took place.
Additionally, as the withdrawals are also to be suspended soon had led to some users trading their cryptocurrencies below market value in order to exit their positions in USD. Simultaneously, a notice from the exchange stated that the last day for USD withdrawals will be July 20.
A similar situation had happened in late May in regards to the Australian Dollar at the Australian branch of Binance when the company’s third-party payments provider shuttered fiat on and off ramps. At that time, the price of BTC on Binance fell 20% compared to global spot prices when traded against the Australian dollar.
Previously, amid the increasing selling pressure due to the regulatory crackdown, Bitcoin was selling $1,000 lower than the standard price on Binance US as reported by Todayq News. The ongoing lawsuit has multiplied troubles for the exchange especially in the face of dwindling investors’ confidence.