- The Securities and Exchange Commission (SEC) and Binance, the biggest cryptocurrency exchange in the world, have been at odds for a number of weeks.The SEC recently sued the exchange, claiming issues with several facets of Binance’s business practices.As a result, Binance has seen a sharp drop in the volume of its spot trading.
The SEC’s request for a temporary restraining order against Binance.US during the legal procedures was also denied by Judge Jackson.However, Binance has taken proactive measures, like as rescinding its licensing application in Austria and applying to be deregistered as a crypto service provider in Cyprus.According to insiders with knowledge of the matter, 50 employees of Binance have had their employment terminated due to the ongoing legal dispute.These unnamed sources revealed that the affected employees worked in the compliance, risk, and legal departments at Binance.US.
The SEC ordered Binance and CZ’s platform to take part in a mediation session to discuss the exchange’s imposed limitations.The SEC’s action against Binance has also helped to fuel the growth of fear, doubt, and uncertainty (FUD), which has affected market pricing.The biggest cryptocurrency player in the US, Coinbase, has also been sued by the SEC.
The second quarter of 2023 saw a fall in spot trading volume for CZ’s exchange as a result of the continuing dispute.A recent research report from Kaiko claims that the aggregate spot trading volume at the top cryptocurrency exchange has significantly decreased by 70%.According to the data, the volume has dropped to a level that hasn’t been seen since the fourth quarter of 2020.
In addition to the unprecedented regulatory aggression, the decision to reimpose fees on a number of bitcoin (BTC) trading pairs is another factor that has contributed to Binance’s (BNB) poor performance.
Other exchanges in addition to Binance have also been impacted by the scenario.The report emphasizes that the spot trade volume on Coinbase, Kraken, and OKX has also decreased by over 50%.One of the key causes of this reduction may be the regulatory ambiguity that exists in the United States.
In parallel, interest in a well-known asset management company’s anticipated introduction of a Spot Bitcoin ETF increased, which boosted trade momentum for the Spot Bitcoin ETF.It was the fifth time in the fund’s operational history that the ProShares Bitcoin Strategy (BITO) fund saw a phenomenal daily trading volume reach $500 million.