The SEC’s lawsuit “storm” is targeting leading digital asset exchanges Binance and Coinbase, causing significant turbulence in the cryptocurrency community. Allegations of insider trading involving prominent players in the crypto market have been made.
SEC sues Binance and Coinbase
The U.S. Securities and Exchange Commission (SEC) recently dealt a significant blow to Binance, the world’s largest cryptocurrency exchange. The regulatory body has accused Binance and its founder, Changpeng Zhao, of violating various regulations.
According to the SEC, Binance and Zhao were involved in “a sprawling, decentralized network of illegal transactions,” engaging in conflicts of interest, lack of information disclosure, and calculated evasion of laws.
The alleged wrongdoing includes mishandling billions of dollars of user assets and participating in fraudulent schemes to help wealthy U.S. investors evade regulatory frameworks using the international Binance exchange.
SEC Chairman Gary Gensler said:
“Through 13 allegations, we contend that entities of Zhao and Binance have participated in a sprawling, decentralized network of fraud, conflicts of interest, lack of information disclosure, and calculated evasion of laws.”
However, the SEC’s attack doesn’t stop there. Another significant pillar in the cryptocurrency industry, Coinbase, is also under scrutiny by the regulatory agency. The company is accused of operating as a broker and exchange without proper licensing.
The allegations assert that Coinbase’s brokerage, trading, and staking programs violate securities laws.
Gensler asserts:
“We allege that Coinbase, while complying with securities laws, has provided unlawful trading, broker-dealer, and clearing and settlement services.”
Cryptocurrency leaders allege an insider conspiracy
Amidst a series of controversies, a hypothesis has gained attention. Could all of this be an insider conspiracy? Are regulatory agencies targeting a complete eradication of cryptocurrency exchanges from the “map” to pave the way for Wall Street dominance?
Preston Pysh, co-founder of “The Investor’s Podcast,” has suggested that recent filings for Bitcoin ETFs and spot exchanges by Wall Street giants such as Blackrock, Fidelity, Citadel, Schwab, and Deutsche Bank indicate an organized conspiracy.
Will Clemente also shares Van de Poppe’s perspective. The co-founder of Reflexivity Research has raised questions about the sudden interest of these Wall Street giants in what they consider a “valueless Ponzi scheme.”
Professor J.W. Verret has highlighted the potential ramifications that investors may face from the SEC’s legal assault. Verret has drawn parallels between the hidden consequences of these lawsuits and the devastating impact caused by infamous Ponzi schemes like Bernie Madoff’s.
These combined factors create concerning implications, hinting at an underlying power play between Wall Street and government regulatory agencies. Ultimately, the outcome of this game could potentially destroy the entire cryptocurrency industry.
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