Why crypto giants Binance and Coinbase have had a very rough week
MSNBCJun 08, 2023
After the US Securities and Exchange Commission (SEC) sued crypto giants Binance and Coinbase earlier this week, the US’ independent branch of Binance, Binance.US, announced it will no longer allow users to trade US dollars on its exchange Thursday, changing to a “crypto-only” platform.
The SEC also asked a D.C. court to freeze Binance.US’s assets, which are held by BAM Trading — citing efforts to protect US customers from Binance’s “evasion of regulatory oversight” in a volatile crypto market.
If there’s anything we’ve learned from the past few months, it’s that regulators cannot stand idly by while crypto companies orchestrate billions of dollars worth of transactions and hold billions of American dollars without proper oversight. Like any emerging industry, there's uncertainty regarding asset classification and how pre-existing laws apply to novel businesses. However, the SEC has been clear that Binance.US must be separate from Changpeng Zhao’s Binance, and there is ample evidence that the two entities are exchanging customer funds freely and circumventing American law.
The SEC is overstepping its bounds and making legitimate cryptocurrency exchanges pay for the sins of fraudulent FTX. Federal regulators are showing a clear lack of understanding about digital assets and cryptocurrency and are targeting an entire industry based on the actions of a few bad companies. At the end of the day, the SEC has always had it out for crypto and its potential to revolutionize the global economy, and it will go after the industry by any means necessary.
There is a 30% chance that Binance or one of its subsidiaries will file for bankruptcy or be sold “under duress” before 2024, according to the Metaculus prediction community.