The SEC just dropped a bombshell on Binance.US, the American arm of the world’s largest cryptocurrency exchange. The regulator filed an emergency action application against Binance.US to freeze its assets, as part of the regulator’s recent crackdown on the crypto exchange.
Protecting Customer Funds On Binance.US
According to the documents filed with the court, the request was brought forward with the intention of ensuring that the assets of Binance.US clients are safeguarded and kept in the United States. At least pending the outcome of the ongoing litigation being conducted by the SEC.
The filing is also looking to activate other emergency relief against Binance Holdings Limited, the arm of the exchange operating globally, and its founder, Changpeng Zhao. This is coming after news broke out on Monday, June 5, that SEC brought 13 charges on Binance.US and its billionaire founder, Changpeng Zhao, saying the company broke US rules by offering securities in the form of cryptocurrencies.
According to the charges, the exchange had “no oversight or controls to ensure that the assets are properly secured.”
What Does This Mean For The Industry?
Basically, the SEC is arguing Binance.US has been illegally facilitating the trading of securities. As the biggest exchange in the world, this has got many investors feeling a bit rattled and confused about what it all means. However, Binance is not the only target of the SEC. The commission also went after Coinbase, alleging that popular cryptocurrencies offered by the exchange qualify as securities.
A big part of the crypto community seems to be unified on the matter, as many investors see this as an attack on the entire crypto industry. Of course, Binance.US and Coinbase deny all allegations, with Coinbase CEO Brian Armstrong tweeting that the “SEC has taken a regulation by enforcement approach that is harming America.”
Binance seems to be calm on the matter as in response, the exchange released a statement saying “we intend to defend our platform vigorously,” although it “will continue to cooperate with regulators and policymakers in the U.S. and across the globe.”
Changpeng Zhao also took to Twitter to announce that if the order is granted, it would only affect funds under Binance.US, and not the global Binance.com.
Things also seem to be level headed, as faith in crypto platforms remains strong. However, tweet alerts from Whale Alert on Twitter shows that crypto whales have moved over $60 million worth of MATIC off Binance.US to unknown wallets in two transactions after news broke out regarding the SEC’s motion to freeze the exchange’s assets.