Read in Our Curacao Gaming License Guide:
- You are here – Why USD Transfers Are Decreasing in Europe
- Curacao Gaming License Costs and Requirements
- How to Get an Online Gaming License?
- How to Set-Up a Gaming Company and Open an Online Casino Business
- Online Gambling Licenses – How to Keep the Law and Succeed at the Same Time?
- What Licenses Are Necessary to Run a Gambling Website?
- Online Gambling Jurisdictions and Licensing Authorities
- Recommended Banking and Merchant Accounts for Online Gaming Businesses
- Where can you Operate with a Curacao Gaming License?
For many decades the U.S. dollar has been the global currency used for most international transactions across the US, Asia and Europe.
The reason for this can be traced back to 1944 when the major developed countries agreed to change from the gold standard to a system where all currencies are pegged on the exchange rate of the USD. Since then countries have backed their currencies with USD rather than gold. This solidified the power of the dollar as an international currency.
In recent years the US financial system has increased its AML, due diligence and compliance procedures. These actions have affected banks worldwide and led to caution when making USD transfers for their clients through US banks acting as intermediaries. Each transfer traveling through the US comes under scrutiny and can be frozen, rejected, approved or the relevant transfer documents can be questioned. Of course every bank involved in the transfer is within their rights to verify the transfer; request documents; examine its legitimacy and check there is no risk of money laundering. US intermediary banks also have the authority to ban certain industries from transferring USD including Forex companies and gaming companies.
Why European Banks Encourage EUR Transfers Rather than USD
European institutions can encounter problems when transferring large amounts of USD through American banks. It is at the US banks’ discretion to close the European bank’s account at any time which would mean the European bank would not be able to transfer USD outside their system. This can cripple a bank which holds their clients’ USD but cannot move them in or out. For this reason, European banks try to minimize their exposure and risk by shying away from USD transfers through American banks. Instead European banks encourage their clients to make Euro transfers through SEPA avoiding American intermediary banks all together and thus avoiding problems with American regulations, restrictions and supervision. Transfers are also recommended in other currencies like AUSD and Swiss Francs.
This trend appears to be leading towards diminished use of USD in transactions in Europe and international transactions being made in multiple currencies rather than predominantly USD transfers.
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