How the SEC’s case against Binance is creating confusion in the cryptocurrency markets
The US Securities and Exchange Commission (SEC) has brought legal action against Binance, the world’s largest cryptocurrency exchange, charging it with 13 different offenses that include mismanagement of its funds, lying to the regulator, selling unregistered securities and giving US customers access to a service banned at home.
In 2019 when the company was prohibited from operating in the United States for regulatory reasons, its response was to team up with other investors and open Binance.US, a separate exchange designed to comply with US federal laws. Despite being banned in Hawaii, Idaho, Louisiana, New York, Texas and Vermont, it continues to provide US citizens unrestricted access to Binance. The company has been accused on several occasions of facilitating tax evasion, money laundering and the financing of terrorist organizations, and has successfully used various subsidiaries to bend, if not break, the rules thanks to an anything goes business cultures that take advantage of loopholes in the law.
I’m no fan of Binance, and the entire industry knew the charges were only a matter of time; its founder, Changpeng Zhao, known as CZ, has acquired a certain notoriety in the cryptocurrency world, along the lines of characters like Do Kwon or Sam Bankman-Fried. At the same…
