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Bitcoin Crashes in Response to SEC Lawsuit Against Binance and CEO

Bitcoin and Ethereum start the new week in the red

Today, the US Securities and Exchange Commission (SEC) filed a lawsuit against Binance and its CEO, with 13 charges. According to a message from Bloomberg The world’s largest crypto exchange and its CEO Changpeng “CZ” Zhao have been charged with violations of US securities laws, as revealed in the lawsuit.

What has Binance been sued for?

The SEC’s charges include offering and selling unregistered crypto assets, failing to deny U.S. investors access to Binance.com, and operating as an unregistered exchange and broker.

A document filed by the SEC in federal court in the District of Columbia on Monday alleges that Binance and its CEO are guilty of “blatant disregard” of federal securities laws. They allegedly “enriched themselves with billions of US dollars” while at the same time exposing investors’ assets to significant risk.

Gurbir S. Grewal, the director of the SEC’s enforcement department, stated in a press release today: “We believe that both Zhao and Binance themselves were fully aware of the regulations, but nevertheless chose to deliberately ignore them, thereby exposing their customers and investors to risk. All this with the sole purpose of increasing their own profit.”

SEC Chairman Gary Gensler emphasized that Binance “attempted to evade US securities laws by implementing superficial controls that they ignored internally.” This was reportedly an attempt to allow major US investors access to the platform.

On Twitter, Zhao indicated that he had not yet learned of the lawsuit. He posted the number 4, a reference he often uses to a tweet from January associating this number with “ignoring FUD (Fear, Uncertainty, Doubt), fake news and attacks.”

“Haven’t seen it yet,” he tweeted Monday. “The media gets the information before we do.”

Crypto prices crash

Binance’s BNB token took a sharp plunge following the news; it is currently trading at USD 278, which represents a 24-hour decline of more than 8.5%.

The prices of other crypto coins also turned dark red immediately after the news. For example, the Bitcoin price has fallen by more than 4.8 percent and Ethereum and XRP have also lost more than 4 percent in recent hours.

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