The US Securities and Exchange Commission (SEC) has filed fresh charges against the world’s largest crypto exchange, Binance and CEO, Changpeng “CZ” Zhao.
The commission is bringing 13 charges against the exchange, accusing it of transferring billions of dollars in user assets to a European company controlled by CZ.
Binance is also accused of “blatant disregard” of federal laws and subverting the SEC’s control to let high net-worth individuals trade on the exchange, which it describes as unregulated.
“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,” SEC Chair Gary Gensler said in a release.
Binance is already in court over charges by the Commodities and Futures Trading Commission (CFTC) which alleges that Binance willfully disregarded federal laws, similar to the charges by the SEC. CFTC is asking the court to, among other things, stop the crypto giant from operating in the US.
The allegations are coming in the wake of a massive crackdown on crypto companies in the US, which is still ongoing. The SEC through its chairman Gensler has stated severally that any cryptocurrency apart from Bitcoin is most likely a security, which places every crypto exchange under the commission’s jurisdiction.
Coinbase has challenged this position in court, requesting that the SEC develop proper regulations for the crypto industry. The SEC in its response, said it takes time to make such regulations and that there’s sufficient guidance for the industry currently.
Because of this regulatory “war”, Coinbase and other indigenous crypto exchanges are looking to increase their presence outside the US, even though they have no near-term plans to leave the country.
Binance seems to have faced more issues than any of them, though. As a result, the US arm of the exchange, Binance.US, is already reducing CZ’s share. The pressure has also made it necessary for CZ to step down as CEO, with Richard Teng as a potential successor.
