Sebastian Sinclair

Dapper Labs said Monday it can no longer process Automated Clearing House (ACH) payments due to its payment partner, Circle.



In an announcement on its public Discord server, Dapper said Circle has made the decision to stop processing ACH payments for all of its partner companies, “effective immediately.”



“We work with a payments partner, Circle, to manage certain transactions,” Dapper said. “As a result, the ACH payment method is currently unavailable.” 



Circle is also the primary issuer of dollar-pegged stablecoin USD Coin, the second-largest by supply after tether.



For ACH payments currently in process, Dapper said it is actively monitoring and working with its payment partners to resolve any issues “as quickly as possible.”



ACH payments are a type of electronic funds transfer (EFT) that allows money to be moved from one US bank account to another. Dapper has said it’s attempting to secure a new partner for ACH payments as well as enabling withdrawals directly to credit and debit cards.&nbsp;



Dapper, mostly known for NFT-focused projects NBA Top Shot and CryptoKitties, had announced Sunday it was “temporarily” disabling the payments while it investigates an issue with one of its third-party partners.



Circle and Dapper Labs did not immediately respond to Blockworks’ request for comment. CoinDesk first reported the news.



Users are still able to withdraw USD via wire transfer and USDC, the latter on Ethereum and Flow blockchain networks, while NFTs can continue to be bought via credit card, debit card and crypto, Dapper said.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

Circle Dropped Automated Clearing House Payments: Dapper Labs

Shalini Nagarajan

<div id="highlights-block_633a9b51fa950" class="highlights">
 <ul>
 <li>Coinbase experienced issues with the electronic system that facilitates online US bank transfers</li>
 <li>Prominent blockchain Solana also suffered hours-long downtime over the weekend</li>
 </ul>
 
</div>



Coinbase has reassured users that all funds are safe after the exchange was unable to process US bank transactions for nearly six hours over the weekend.



Account holders with US bank accounts found they couldn&#8217;t make withdrawals or payments on Coinbase from 6:57 am ET to 12:41 pm ET on Sunday.



The company identified the issue as a snag with the Automated Clearing House (ACH) system, the electronic network that facilitates online transfers between US banks.&nbsp;



Users in the US were not completely blocked from buying crypto, as they could still use a debit card or PayPal account. But cash withdrawals were fully frozen during the outage.



Coinbase says more than <a href="https://www.coinbase.com/about" target="_blank" rel="noreferrer noopener">103 million</a> people around the world use its platform, but it isn’t clear how many hold US bank accounts. A spokesperson didn’t return Blockworks’ request for comment by press time.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">We’ve fully resolved this issue and ACH transfers are now processing. We apologize for the inconvenience. <a href="https://t.co/dezVgcaagm">https://t.co/dezVgcaagm</a>&mdash; Coinbase Support (@CoinbaseSupport) <a href="https://twitter.com/CoinbaseSupport/status/1576610701757538306?ref_src=twsrc%5Etfw">October 2, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div><figcaption>Coinbase tweeted to confirm that its ACH functionality is now back to normal.</figcaption></figure>



The top US exchange is among the largest in the world, with trading volumes of around $966 million in the last 24 hours, <a href="https://www.coingecko.com/en/exchanges" target="_blank" rel="noreferrer noopener">CoinGecko data</a> shows.&nbsp;



ACH snags may still be the least of Coinbase’s troubles. Its share price fell more than 9% on Thursday after Wells Fargo issued a profitability warning about the company.



Rising competition from <a href="https://cms.blockworks.co/tag/binance/" target="_blank" rel="noreferrer noopener">Binance</a> and <a href="https://cms.blockworks.co/tag/ftx/" target="_blank" rel="noreferrer noopener">FTX</a> will pressure the firm and eat into its market share, equity analysts Jeff Cantrell, Amid Patel and Griffin MacMaster wrote in a note seen by Blockworks.&nbsp;



Given <a href="https://cms.blockworks.co/ethereum-merge-attracts-sec-chairs-attention-eth-drops/" target="_blank" rel="noreferrer noopener">recent discussion</a> from the SEC regarding “cryptos as securities” (such as for staked assets), regulation will be a particular challenge for the company, they added.



Coinbase is trading 2.3% lower in Monday’s pre-market session at $63 per share, down 75% in the year to date, according to <a href="https://www.tradingview.com/chart/?symbol=NASDAQ%3ACOIN" target="_blank" rel="noreferrer noopener">TradingView data</a>.



<h3 class="wp-block-heading">Coinbase bank difficulties in tandem with Solana downtime</h3>



Coinbase’s trouble with the US banking system wasn’t the only outage event this weekend.&nbsp;



Prominent blockchain <a href="https://cms.blockworks.co/jump-crypto-partners-with-solana-to-build-new-validator-software/" target="_blank" rel="noreferrer noopener">Solana</a> stopped processing transactions due to a glitch that caused about six hours of interrupted service on Saturday morning.



The downtime affected DeFi apps across the Solana ecosystem, as many rely on constant connection with protocols throughout the crypto landscape, particularly price oracles.



Chain watchers noted that decentralized trading protocol Mango Markets was unable to handle liquidations or receive margin deposits until the issue was resolved — affecting at least one sizable long contract worth almost $2.5 million.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="550" data-dnt="true">Solana has been down for nearly 5h, and validators are currently coordinating an attempt to restart. There is a long contract with nearly 2.5m in the Mango market that is in the liquidation range. However, the holder can neither add margin nor liquidate. <a href="https://t.co/ppVjFaJ2pe">https://t.co/ppVjFaJ2pe</a>&mdash; Wu Blockchain (@WuBlockchain) <a href="https://twitter.com/WuBlockchain/status/1576037034170335233?ref_src=twsrc%5Etfw">October 1, 2022</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Solana validators eventually coordinated to restart the network, which has suffered at least 12 significant outages so far in 2022, according to its <a href="https://status.solana.com/history?page=1" target="_blank" rel="noreferrer noopener">incident history</a>.&nbsp;



The price of Solana’s native token, SOL, was mostly unaffected by the incident, having lost around 3% over the weekend, more-or-less in line with the rest of the digital asset market.



<hr class="wp-block-separator has-alpha-channel-opacity"/>



Start your day with top crypto insights from David Canellis and Katherine Ross. <a href="https://blockworks.co/newsletter/empire">Subscribe to the Empire newsletter</a>.



Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. <a href="https://blockworks.co/newsletter/onthemargin">Subscribe to the Forward Guidance newsletter</a>.



Get alpha directly in your inbox with the <a href="https://blockworks.co/newsletter/research">0xResearch newsletter</a> — market highlights, charts, degen trade ideas, governance updates, and more.



The Lightspeed newsletter is all things Solana, in your inbox, every day. <a href="https://blockworks.co/newsletter/lightspeed">Subscribe to daily Solana news</a> from Jack Kubinec and Jeff Albus.

automated clearing house