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US securities regulators unveiled 13 charges against Binance entitites and founder Changpeng Zhao
US authorities on Monday charged cryptocurrency giant Binance with securities law violations that collectively amounted to what they called “an extensive web of deception” and “calculated evasion of the law.”
Binance, the world’s largest cryptocurrency exchange, is alleged to have permitted US residents to trade, even though the platform is not registered in the United States as a securities exchange. The case also alleges Binance misused customer funds.
According to AFP, the Securities and Exchange Commission filed a civil complaint listing 13 charges involving platforms and other investment entities controlled by founder Changpeng Zhao, who was once seen as the archrival of disgraced crypto tycoon Sam Bankman-Fried.
The SEC case comes on the heels of charges in March by another US regulator, the Commodities Futures and Exchange Commission.
“Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,” said SEC Chair Gary Gensler.
“As alleged, Zhao and Binance misled investors about their risk controls and corrupted trading volumes while actively concealing who was operating the platform, the manipulative trading of its affiliated market maker, and even where and with whom investor funds and crypto assets were custodied.”
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Binance criticized the SEC action as a wrongheaded approach that threatens “America’s role as a global hub for financial innovation and leadership,” the company said.
“Digital asset laws remain largely undeveloped in much of the world, and regulation by enforcement is not the best path forward,” Binance said in a statement. “An effective regulatory framework demands collaborative, transparent, and thoughtful policy engagement — a path the SEC has abandoned.” Read more.
