SEC Sues Binance For Violating Securities Laws• June 6, 2023 3:21 pm • Comments
In addition to Coinbase getting sued by the SEC, it looks like Binance is finding itself in the same situation as well.
The news has been revealed that the SEC is suing both Binance and its CEO Changpeng Zhao for securities law violations.
This is not the first time that Binance has gotten itself into legal trouble with the SEC, but it seems to be quite a coincidence that it would get sued for this at the same time as Coinbase.
It is almost as if the SEC is now taking legal action against the entire crypto industry which is a major obstacle to mass adoption and growth within the country.
Binance CEO has already commented on the news on Twitter and questioned if Gensler and the SEC ever had any intention of protecting investors like they are supposed to.
But this isn't about protecting investors, it's a desperate attempt to cling to a financial system that's rigged in favour of the elite.
The SEC's job isn't to protect us.…
— Lady of Crypto (@LadyofCrypto1) June 6, 2023
Specifically, the SEC claimed Binance misused “billions of dollars” in customer funds. Additionally, those funds were allegedly sent to a separate company that is owned by Zhao. Moreover, these charges also include lies that the company told investors regarding its business.
These lies reportedly center around adequate systems in place for the detection of manipulative trading. Regulators also state that Binance did not do enough to keep US investors from gaining access to the platform.
The developing story follows previous rumors of a new CEO at the exchange. Nevertheless, the largest crypto exchange by trading volume has been under increasing pressure from regulatory agencies.
Still, the Justice Department is currently observing the exchange for allegations of money laundering practices.
It is also rather strange why the SEC would suddenly take so much legal action against two of the largest crypto exchanges this year.
Both exchange have already been around for many years so taking legal action now would be extremely late and would not many any sense.
Nevertheless, it seems that Binance had already prepared for such a situation as this was not the first indication that the regulatory environment was unfavorable towards crypto.
Binance has released an official statement following the news of the SEC lawsuit and had stated that they will cooperate with the SEC as much as possible.
It is unclear if this will affect whether or not US customers will be able to access Binance in the future.
— Vulture Peak (@vulture_peak) June 6, 2023
In a blog post that followed, Binance wrote, “We are disappointed that the U.S. Securities and Exchange Commission chose to file a complaint today against Binance seeking, among other remedies, purported emergency relief.”
The company added that it has “actively cooperated with the SEC’s investigations” and “engaged in extensive good-faith discussions to reach a negotiated settlement to resolve their investigations.”
“Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,” SEC Chair Gary Gensler said in a release.
“Simply put, today’s filing is unjustified by the facts, by the law, or by the Commission’s own precedent,” Binance’s U.S. business said in a statement.
— Ki Young Ju (@ki_young_ju) June 5, 2023
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