• The U.S. Commodity Futures Trading Commission (CFTC) is suing Binance and its founder Changpeng Zhao for violating the Commodity Exchange Act and other regulations.
• CFTC officers are seeking financial penalties and a permanent ban in the United States.
• The price of bitcoin immediately descended from its nine-month high after the CFTC made the announcement.
U.S. Commodity Futures Trading Commission Files Lawsuit Against Binance
The U.S. Commodity Futures Trading Commission (CFTC) has filed a lawsuit against crypto exchange Binance and its founder Changpeng Zhao, alleging financial violations of the Commodity Exchange Act and other regulations. CFTC chair Rostin Behnam stated that this should be a warning to anyone in the digital asset world that they will not tolerate willful avoidance of U.S law, while Gretchen Lowe – principal deputy director and chief counsel to the CFTC’s enforcement division – noted that Binance deliberately chose profits over following the law.
Binance Performance & Popularity
Binance is one of the world’s largest digital currency trading platforms with an estimated 90 million users across multiple countries, having overseen roughly $9 billion in digital transactions in just the last few days alone. The company is run by various corporate entities rather than a single governing body, which enables it to evade regulation and committee oversights more easily according to allegations made by the CFTC against them in their lawsuit.
Impact on Bitcoin Price
The news had an immediate effect on bitcoin prices; dropping it from its nine-month high of around $28K to around $26K after being announced by the CFTC.. Ed Moya – an analyst at Oanda – commented on this situation saying: “Many knew Binance had a bullseye on its back, but this is still unnerving some crypto traders [as] Binance’s success is needed to ensure a good part of the cryptoverse can grow.“
CFTC’s Expanding Reach into Crypto Space
This isn’t the first time we’ve seen US regulatory agencies make moves towards cracking down on crypto activity; both FinCEN and IRS have been making strides towards obtaining greater oversight into cryptocurrency markets as well as taxation regulations within recent months too; demonstrating how seriously US regulators are taking cryptocurrency activities now more than ever before..
Conclusion
Crypto exchanges need to be aware that they are not exempt from regulation, especially when operating within certain geographical boundaries such as those relevant in America; where authorities are increasingly looking out for compliance issues related to these new markets which may not have been considered before now due their relative infancy compared to more traditional finance markets..