A recent update by Binance has revealed that Signature Bank, a major SWIFT gateway service provider, will partially terminate access to Binance customers starting in February.

Hours after the announcement, concerns were raised about the possibility of other US banks limiting exposure to cryptocurrencies by regulating their SWIFT gateway. However, a section of the crypto community expressed optimism about the unlikelihood of a widespread SWIFT ban, adding that this appears to be a lone case of limiting crypto exposure by the New York-based bank, which recently came under scrutiny for its in-house blockchain feature, Signet.

SWIFT, which stands for Society for Worldwide Interbank Transactions, is a unified gateway for the exchange of information and transactions by financial institutions worldwide. Within the crypto sector, SWIFT is crucial for the institutional adoption of crypto as it is the most widely used gateway for attracting inflows from new users into crypto. 

A shutdown of SWIFT will mean significant paralysis for crypto, which still relies on the inflow of fiat to grow its ecosystem. The war in Russia witnessed the first time SWIFT access was terminated, prompting the rise of crypto through illegal platforms like Bitzlato to circumvent restrictions.