- Partick Hillmann, Chief Strategy Officer of Binance Exchange, stated that the US SEC has been confusing in the past six months.
- In 2021 the Financial Conduct Authority ordered the exchange to halt all its activities in Britain.
- In March, the Commodity Future Trading Commission filed a lawsuit against the largest crypto exchange.
2023 so far has been a rocky year for the crypto industry. Many might think that the FTX crash only affected digital currency prices, but it did far more damage. The fear and realization that a legitimate crypto exchange can scam its users has given governments and organisations leeway to impose strict restrictions. Many parties have tried to tighten their grip on several crypto regulations and laws by reaffirming their fears of digital currency. Binance exchange, the world’s largest crypto exchange, has called out the Securities and Exchange Commission (SEC) for its crackdown on digital currency.
In a matter of months, some exchanges shut down due to the crypto winter. At the same time, others were from the intervention of the SEC. This has brought about a split community within the crypto industry.
Many view the efforts of the SEC as genuine, with the people’s interests at heart. Unfortunately, others see it as a front to try and take control of the crypto industry by using the very loopholes of the crypto regulation to control the movements of the crypto exchanges.
Binance exchange calls for proper crypto regulations.
One of the few demerits of the crypto industry is the lack of proper crypto regulations. This fact has plagued Africa and the world since the Golden Age of Bitcoin in 2017. Its decentralized nature and high volatility have proven too cumbersome for organizations and governments to control entirely. In truth, the entire concept of digital currency was to prevent a single entity from holding it. Unfortunately, crypto laws are required to avoid illegal activities.
Due to this reason, the SEC has dedicated itself to enforcing existing crypto regulations. With the previous FTX crash, it became clear that even legitimate companies have the potential to cause severe damage to the population. Thus, The SEC tightened its crypto laws and pursued any crypto exchange with any hint of violation. Unfortunately, many claim that the SEC has exceeded its initial intent.
Also, Read Bitcoin Lightning Network Interconnects Africa and European financial systems.
Binance exchange has said that the crackdown on crypto regulations has made it “extremely difficult” t conduct their businesses in the US.
Over the past few months, the SEC has clashed with the likes of Kraken, forced Bittrex into bankruptcy and still has its sights set on others. Binance exchange has clashed with several US regulators on suspicion of illicit activity this year. In March, the Commodity Future Trading Commission filed a lawsuit against the largest crypto exchange.
According to their claims, Binance had violated sevral crypto regulations and operated illegally in the country. They had extensively solicited US citizens, but Binance Exchange commented on their claims as “unexpected and disappointing.”
Furthermore, the Department of Justice compared the Binance exchange to Bitzlato, whose founder had illegally transmitted millions of crypto funds violating US money-laundering regulations.
Binance Exchange sets its eyes on Europe.
With the SEC hot on their heels, Binance has opted to look for cooler grounds. Hillman stated that to retain its title as the largest crypto exchange; it will shift its sights to Europe. Currently, Binance is reviewing its policies to ensure its operations are up to the crypto regulations of the UK.
Also, Read SEC warns crypto traders and investors of the looming honey trap.
Despite this sudden move, the organization has had its fair share of moments with Londn’s regulatory bodies. On one occasion, they stated that they could not regulate the exchange after it failed to provide basic information about its business activities. They claim that “the group has no fixed headquarters yet offers services worldwide.”
In 2021 the Financial Conduct Authority ordered the exchange to halt all its activities in Britain. Furthermore, in 2021, a joint venture partner stated that the company had filed an inaccurate annual report for one of its UK subsidiaries.
Unfortunately, Hillman declined to confirm whether the company reapplied for its FCA registration. This is unsurprising since most UK officials are wary of fintech and crypto companies.
Within the week, Revolut had claimed that the “extra” cautious UK regulators we the cause of delays experienced among exchanges.
For the Binance exchange to adhere to the set crypto regulations, it will require plenty f effort to convince the officials.
Conclusions
The crackdown on crypto regulations and laws was an inevitable outcome of the FTX crash. The SEC has every right to tread carefully with any crypto exchange.
However, it has clarified that more than merely monitoring operating crypto exchanges are needed. Its intent on exposing any illegal activities might be pushing the boundaries of its intentions. IS the SEC right at going after the crypto exchange, or is it overstepping its abilities to try and control the crypto industry?
