Swan Bitcoin Issues Warning About BTC Mixing Services
If you are using Bitcoin mixing services, Swan Bitcoin has issued a warning that your account may be at risk of termination due to increased scrutiny from banks and custodians. The company’s banking and custodial partners have been freezing or terminating accounts involved in mixing Bitcoin. Swan Bitcoin emphasized that depositing funds directly to or withdrawing funds directly from crypto mixing services could lead to the termination of your account by their banking and custody partners.
Swan Bitcoin Responds to Regulatory Pressure
Yan Pritzker, the Chief Technology Officer (CTO) of Swan Bitcoin, disclosed that the platform’s clients engage with qualified custodians and banks to facilitate the BTC onramp function. Currently, Swan collaborates with two qualified custodians, with a third expected to join this quarter and a fourth anticipated to be launched in 2024. These custodians establish connections with multiple banking institutions to offer fiat services. However, Pritzker noted that the pool of banking institutions willing to provide services to companies in the crypto space is limited and diminishing.
Pritzker remains a privacy advocate and encourages the use of mixers. However, he acknowledged that the current political climate has injected fear into the banking sector, leading many banks to refuse dealings with anything related to crypto. Banks are intensifying their Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements as a measure to sustain their operations in this evolving business landscape.
Increased Scrutiny on Bitcoin
Pritzker also pointed out inaccuracies in news stories exaggerating Hamas funding from crypto and mentioned that Bitcoin is an easy scapegoat for the failings of the system because it is still poorly understood in Washington and by the media. Swan Bitcoin isn’t the only one drawing attention to inaccurate reports; stablecoin issuer Tether also set the record straight on biases of mainstream media. The US Deputy Treasury Secretary Wally Adeyemo clarified that crypto isn’t primarily responsible for terrorist financing, with expert testimonies asserting funding was coming from traditional fiat channels.
Hot Take: The Impact of Regulatory Pressure on Crypto Users
The warning issued by Swan Bitcoin highlights the impact of regulatory pressure on individuals engaging with cryptocurrency mixing services. As banks and custodians increase scrutiny and impose stricter requirements, crypto users must navigate a changing landscape where certain activities may put their accounts at risk. This underscores the need for clear communication between cryptocurrency platforms and their users regarding potential risks associated with specific transactions or services.
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