US regulator accuses world’s largest crypto exchange Binance of violating securities laws

Washington, Reuters: The world’s largest crypto exchange Binance has been accused of violating securities laws in the US. Binance and its CEO and founder Changpeng Zhao were sued by the U.S. Securities and Exchange Commission.

Binance was accused of misleading investors about its market surveillance controls and failing to allow US customers to use its platform. He is also accused of running a securities exchange without registration.

These allegations against Binance come at a time when the crypto market is going through a crisis due to waning investor confidence.

Serious allegation on Exchange CEO as well

The SEC’s complaint, filed in federal court in Washington DC, also alleges that Binance and Zhao secretly controlled customers’ assets, allowing them to siphon and divert customers’ funds. Also, Binance created separate US entities as part of an elaborate scheme to avoid US federal securities laws.

Binance did not respond

Earlier in March 2023, the exchange was accused of violating several rules by the US regulator. At present, no response has been received from Binance regarding these allegations. Zhao said in a tweet that the company would respond after looking into the complaint.

Negative impact on the crypto market

After the world’s largest crypto exchange was once again surrounded by allegations, the crypto market is registering a sharp decline. All major cryptocurrencies like bitcoin, ethereum are trading down. Till the time of writing the news, while bitcoin was trading with a decline of about 4 percent, the second largest coin Ethereum also registered a decline of about one percent.