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Crypto Markets Dive After SEC Sues Binance Crypto Markets Dive After SEC Sues Binance

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Crypto Markets Dive After SEC Sues Binance – Crypto News

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Filing alleges Binance CCO admitted “we are operating as a fking unlicensed securities exchange in the USA bro.”

The SEC is taking the world’s largest crypto exchange and its founder Changpeng Zhao (CZ) to court for allegedly violating federal securities laws.

Crypto markets turned sharply lower on the news, with BNB crashing 9% to its lowest point since March.

Other digital assets also felt the shock, with both BTC and ETH down roughly 5% over the last 24 hours, trading at $25,741 and $1,807, respectively.

Investors were likely spooked by the SEC’s labeling of a number of digital assets and services as securities offerings. These include the digital assets BNB and BUSD, as well as services such as BNB Vault, Simple Earn, and a staking investment platform available on Binance.US.

Filed today, the litigation names CZ, Binance, and affiliated companies, alleging “blatant disregard of federal securities laws.”

Company compliance officers were aware of the risk, and Binance’s CCO allegedly admitted in 2018 that “we are operating as a fking unlicensed securities exchange in the USA bro,” according to the filing.

The agency went on to say, “Zhao and Binance understood that they were operating the Binance.com Platform in violation of numerous US laws, including the federal securities laws, and that these ongoing violations presented existential risks to their business.”

Binance Responds

In a statementsBinance called the commission’s actions the result of a determination “to regulate with the blunt weapons of enforcement and litigation rather than the thoughtful, nuanced approach demanded by this dynamic and complex technology.”

“Any allegations that user assets on the Binance.US platform have ever been at risk are simply wrong, and there is zero justification for the Staff’s action in light of the ample time the Staff has had to conduct their investigation,” said Binance.

The unilateral labeling of some tokens and services as securities by the SEC as other US authorities Simultaneously asserting jurisdiction only serves to complicate matters, said Binance.

A Trial By Jury

The commission seeks preliminary injunctive relief from the court, including potential asset freezes, accounting audits, asset repatriation, and expedited discovery. Also requested is an order for data and document preservation, and the prohibition of the destruction of evidence, and the appointment of a receiver and alternative services.

In addition, the SEC is seeking a trial by jury and petitioned the court to put a halt to CZ and Binance’s activities. The agency also wants a ruling to direct Binance companies to pay fines and return all illegal profits with interest.

But Binance won’t go down without a fight.

“Because Binance is not a US exchange, the SEC’s actions are limited in reach. Still, we stand with digital asset market participants in the US in opposition to the SEC’s latest overreach, and we are prepared to fight it to the full extent of the law,” said Binance.

This is just the latest in a series of enforcement actions aimed at the crypto industry.

In March, the SEC allegedly that Coinbase, the leading US crypto exchange, had also violated securities laws, and issued a Wells Notice to the exchange.

Weeks earlier, cryptocurrency exchange Kraken opted to shutter its staking services in the US after paying $30M to settle a lawsuit from the SEC.

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