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Binance said users who have not been fully verified can withdraw up to 0.06 BTC daily. The previous limit was set to 2 BTC.
Binance Reduces Money Laundering Risks
Binance, the world’s largest cryptocurrency exchange by trading volume, has readjusted its daily withdrawal limits for unverified users, slashing it by 97%.
Today, the exchange said accounts with Basic Account Verification would only be able to daily withdraw up to 0.06 BTC (around $2,200) in total value. Previously, the limit was set to 2 BTC (around $75,000).
In a blog post, the exchange announced:
“Daily withdrawal limits will be adjusted to 0.06 BTC for accounts which have completed only Basic Account Verification.”
The modification has been implemented for new users and for existing users it will take place in phases between Aug. 4 and Aug. 23, 2021.
With Basic Account Verification, Binance asks users to submit their official name, address, and personal email. However, those details do not get checked against any official government-issued identity or document.
Implementing a limit on daily withdrawals is a common practice practice among most crypto exchanges to curb illegal activity such as money laundering.
In comparison, once an account is fully verified and a user submits identification, they are allowed to withdraw up to 100 BTC (worth roughly $3.7 million) every 24 hours. This limit has not been readjusted.
A reduction of the basic verification limit suggests that Binance is making it harder for people to potentially abuse the previous daily limit of 2 BTC, and therefore cut down on potential cases of illicit activity. Furthermore, the rule will make it harder for Binance users to transact in cryptocurrencies without completing the exchange’s know your customer (KYC) process.
The move comes at a time when Binance faces a lot of heat from regulators worldwide over its lack of KYC and financial reporting rules. Prior reports have suggested that Binance was being investigated for being non-compliant with global anti-money laundering (AML) regulations.
Binance’s CEO Changpeng Zhao recently responded to the scrutiny by confirming that the exchange was planning to double down on compliance with regulations and change its mindset from a “startup to a financial service” provider. The exchange also halted tokenized stock trading earlier this month, claiming at the time that the move was part of an effort to “shift [its] commercial focus to other product offerings.”