The SWIFT payments network has made an extraordinary decision that will have widespread implications on cryptocurrencies.
Asia Markets can reveal SWIFT will no longer process fiat currency transfers from bank accounts to cryptocurrency exchanges, with a value of less than US$100,000, effective from February 1, 2023.
The move will thwart cryptocurrency access to tens of millions of people worldwide.
One of the first crypto giants to notify users of the development this weekend, has been the world’s largest exchange, Binance.
“The banking partner that services your account has advised that they are no longer able to process SWIFT fiat (USD) transaction for individuals of less than $100,000 USD as of February 1, 2023. This is the case for all their crypto exchange clients,” said Binance.
“Please be advised that until we are able to find an alternative solution, you may not be able to use your bank account to buy and sell crypto with USD via SWIFT with a value of less than $100,000 USD.”
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What’s behind the SWIFT crypto decision?
Although SWIFT (an acronym for the Society for Worldwide Interbank Financial Telecommunication) is the world’s most critical financial network – facilitating trillions worth of international money settlements daily – it is a somewhat secretive Belgian-based cooperative.
SWIFT was in the headlines following the outbreak of war in Ukraine last year, when the United States and its allies cut off Russia from the network.
Such was the significance of cutting off Russia from the world’s most important financial network, the French finance minister described the move as a “financial nuclear option”.
Why SWIFT has moved to unleash would could potential become a ‘cryptocurrency nuclear option’ for millions who don’t have the US$100,000 minimum, currently remains a mystery.
One theory, however, is that it could be a primer to the ECB’s Central Bank Digital Currency testing which is set to begin this year, with a full rollout mooted by 2026.
In a recent Capitalist Exploits Insider newsletter by Hedge Fund veteran, Chris MacIntosh, a summary of restrictions that have been proposed by the ECB on digital currency movements was provided.
We note the ideas in the screenshot below are only proposals by the ECB and its members. None have been formalised.
“I’d say bugger all chance they manage to get this implemented worldwide. The world is bifurcating fast as we promised, and with this split comes competition. We are in a war where it’s being fought on all fronts, one of those being finance,” said MacIntosh in the note to subscribers.
“The fact is we’ve a world working towards more decentralisation (folks moving out of cities, for example), secessionist movements globally, and not to mention blockchain technology and various other decentralised networks. This is all taking place while Davos man is attempting to coral us into ‘smart cities’, digital currencies, and so forth.”
More can read from Chris MacIntosh on this topic in the Capitalist Exploits Insider newsletter here.