The SEC to Investigate Binance over $BNB Token
- Federal regulators are reexamining the initial coin offering that served as the foundation for the 2017 release of the Binance cryptocurrency exchange.
- The agency is said to be investigating whether the token’s offering qualifies as a security sale, which would have required registration with the agency.
- The SEC has increased its crackdown on ICOs that fail to register with the agency before going public in recent years.
The Securities and Exchange Commission (SEC) of the United States is apparently investigating Binance, a leading cryptocurrency exchange, for unregistered token sales.
BNB coins are most often used to pay transaction fees on Binance.
Despite attempts by the company to decentralize the asset, BNB currently has a market capitalization of $47 billion and continues to be a key element of the Binance platform.
This isn’t the first time Binance has been in headlines with US regulators, with a continuing SEC investigation into CEO Changpeng Zhao’s ties to two firms trading on Binance. US. Other proceedings include a joint investigation by the Internal Revenue Service and the Department of Justice into tax and money laundering issues, as well as an investigation into insider trading and market manipulation by the Commodity Futures Trading Commission.
Binance has recently received regulatory approvals in Europe and the Middle East, including most recently in France, Italy, and Dubai.
Note that the SEC earlier charged many other crypto-related projects that were fundraised from US investors via ICOs. The authority ruled that such tokens were securities, and major corporations that issued them had to sign up with the SEC before holding such a campaign.
“As the industry has grown rapidly, we have worked very hard to educate and assist law enforcement and regulators in the United States and around the world, while also adhering to new guidelines.” “We will continue to meet all regulatory requirements,” a Binance spokesperson explained.
According to the sources, the alleged SEC investigation into Binance will take at least a few months to complete and may not result in legal action against the company.
The case revolves around the SEC’s regulatory authority over investment contracts and whether digital currencies meet the criteria as such, especially if they have been sold to investors as a way of funding a company with the guarantee of profiting from the company’s ability.
The federal regulatory investigation comes as Reuters published the findings of an unfamiliar investigation in which the news service asserts that at least $2.35 billion in laundered funds were embezzled through Binance between 2017 and 2021.
As serious as the situation appears to be for Binance, netizens do not miss an opportunity to launch sarcastic comments, and this time it seems as if SEC is their primary focus.
@ioxon believes the SEC wants some BNB and that they must generate FUD in order to get a lower price.
@Crypto Adam claims Someone needs to look into the SEC.