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Breaking: SEC files order to freeze Binance assets

Breaking: SEC files order to freeze Binance assets

The filing, submitted to the U.S. District Court for the District of Columbia, was made just a day after the Securities and Exchange Commission initiated a lawsuit against Binance and its CEO Changpeng Zhao.

The SEC’s bid stemmed from a complaint accusing the world’s largest crypto exchange of running an illegal exchange in the United States and commingling billions of dollars’ worth of American customer funds.

Following the enforcement action, investors have reportedly withdrawn roughly $1.43 billion from Binance and its U.S. affiliate. According to data provided by Nansen, Binance experienced net outflows of $1.34 billion worth of crypto tokens on the Ethereum blockchain. Additionally, its US offshoot, Binance.US, recorded net outflows of $70.8 million.

“Through 13 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.

The US regulatory body claims that both Binance and Zhao intentionally circumvented their own internal controls to enable wealthy US investors to trade on the exchange’s unregulated platform. As a result, Binance earned more than $11 billion in revenue between June 2018 and July 2021, primarily derived from transaction fees.

The SEC further accused Sigma Chain, a trading firm owned and controlled by Binance CEO, of engaging in wash trading on the platform of its US-based affiliate. This involved artificially inflating the trading volume of crypto asset securities, creating a misleading perception of market activity to mispresent the liquidity on Binance.US.

The development also comes hot on the heels of a SEC’s lawsuit filed against rival exchange Coinbase in a federal court in New York. Wall Street’s primary regulator alleges that US largest crypto platform has been operating as an unregistered broker.

The post Breaking: SEC files order to freeze Binance assets appeared first on FinanceFeeds.

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