SEC sues Binance and its founder Changpeng Zhao

The US regulator has sued Binance and its CEO Changpeng Zhao for violating securities trading rules. This increased pressure on the world’s largest crypto exchange and sent Bitcoin’s price to the lowest level in three months.

The lawsuit filed by the Securities and Exchange Commission (SEC) in a federal court in Washington listed 13 charges against Zhao, Binance and the operator of the company’s US branch.

The SEC alleges that Binance intentionally inflated trading volumes, allowed US clients to trade on its global platform, and misled investors.

In addition, according to the SEC’s lawsuit, Binance and Zhao diverted client assets, and the company’s US branch was created according to an elaborate scheme to evade compliance with U.S. federal securities laws. SEC Chairman Gary Gensler said that Binance and Zhao are involved in an extensive web of deception, conflicts of interest, and calculated evasion of the law.

In turn, the company said in a blog post that it will defend its platform, and the assets of customers on Binance and affiliate platforms, including Binance.US, are safe.

Binance’s statement also says that the company does not agree with the SEC’s allegations. Binance tried to find a reasonable solution, but the Commission issued new requests and appealed to the court. The management of the exchange also upbraid the agency for its inability to provide clarity in the field of digital assets and the lack of productive interaction.

According to the exchange officials, the company opposes the SEC’s misuse of powers and will fight this together with other participants in the US crypto market, since the actions of the department look like a race for power over jurisdiction, rather than care for the protection of investors.

Against the background of this news, Bitcoin went down in price by almost 6% and fell to the lowest level in three months. The Binance BNB’s price decreased by more than 5%.

According to market participants, this legal process may have an effect on the state of the crypto industry, as Binance is in first place in traded value.

Earlier, the US Commodity Futures Trading Commission filed several charges against Binance, including trading non-registered exchange derivatives and market manipulation. Apart from that, the US authorities have banned the emission of new BUSD tokens.