The SEC Chooses the Nuclear Option

Commentary

The U.S. Securities and Exchange Commission (SEC) has just filed complaints in a federal court against two of world’s largest cryptocurrency exchanges, Binance and Coinbase. Binance, the largest exchange globally with several billion dollars of daily transaction volume, is registered offshore and technically off limits to U.S. investors. Coinbase, on the other hand, is a U.S.-domiciled, publicly listed company, registered with and regulated by the same SEC that approved Coinbase’s 2021 prospectus filing and IPO and is now suing the company.
According to the SEC’s complaint against Binance, the group was operating an unregistered exchange, offering and selling unregistered securities, allowing U.S. customers to trade on the platform, and comingling customer funds. According to SEC chair Gary Gensler, “Through 13 charges, we allege that [founder and CEO Chengpeng] Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.” Binance executives have not helped themselves in that they repeatedly discussed in written forms how to evade the U.S. regulatory system….



Source link