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- 1 13 tokens were declared as securities by the SEC.
- 2 The SEC accused Binance of operating as an exchange without registering with the agency.
- 3 The early hours of Saturday recorded a large number of liquidations which broke the previous record.
The SEC declared that several crypto tokens are securities, which can lead to a possible risk-off situation among traders. The majority of coins declared as securities are among the top crypto platforms and they have a market capitalization of billions of dollars, while some are part of more recent, gaming-focused ventures.
SEC Sues Binance and its CEO for Securities Violation
On Monday, the Securities and Exchange Commission (SEC) announced a high-profile case against Binance. The organization is also keeping an eye on a number of alternative coins like Solana and Polygon.
13 tokens were declared to be securities in the U.S. Securities and Exchange Commission (SEC) lawsuit against cryptocurrency exchanges Binance and Coinbase. Subsequently, prices of tokens of key blockchain networks fell by more than 20% in the past 24 hours amid an anticipated risk-off event.
A total of 13 allegations were brought against Binance and Changpeng Zhao, the CEO of the exchange. The allegations include mixing up customer cash and attempting to skirt U.S. securities laws. They are also accused of having used “sham controls” to limit who can conduct business with the company.
The coins under discussion include the BNB token from Binance, the stablecoin of the exchange, BUSD, and 10 additional tokens which are Solana (SOL), Cardano (ADA), Polygon (MATIC), Filecoin (FIL), Cosmos Hub (ATOM), The Sandbox (SAND), Decentraland (MANA), Algorand (ALGO), Axie Infinity (AXS), and COTI (COTI).
Solana was among those who were hit the hardest when news of the lawsuit became public. The value of many tokens crashed right away when the SEC’s enforcement action was made public. SOL’s price dropped by more than 6% to $20.14 in an hour.
At the time of writing, the price of Alogrand dropped by 9.9% over the previous day to roughly $0.13. Algorand was a cryptocurrency that SEC Chair Gary Gensler had previously praised. According to the data, both Polygon and Polkadot had big drops during the past 24 hours, plummeting by 7% and 6.9%, respectively.
The SEC has accused Binance and BAM Trading of operating as exchanges without registering with the agency, in addition to being broker-dealers and clearing houses. In their defense, Binance has asserted that Binance.US is run by a distinct firm.
According to the SEC, certain cryptocurrencies were offered and sold as securities. This was done in connection with those statements about Binance’s international exchange and Binance.US.
The lawsuit claims that Binance and BAM Trading “has engaged in unlawful unregistered offers and sales of crypto asset securities.” By doing this, they have deprived investors of important information. This included information about risks and trends that could affect the company and the purchase of these assets.
Statistics show that approximately $300 Million worth of crypto-tracked futures were liquidated in the early hours of Saturday, breaking this week’s nine-month record for liquidations.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
