• Binance Coin price fell to trade below $280 within the hour of the announcement of the SEC lawsuit.
  • The Securities and Exchange Commission noted that the cryptocurrency exchange violated securities law.
  • Binance CEO Changpeng Zhao responded to the claims with his standard "4", suggesting FUD, fake news or attack.

Binance Coin price is facing the brunt of the bear market as the already persisting skepticism was flamed further today by the Securities and Exchange Commission (SEC). The regulatory body fired its shot against the world's biggest cryptocurrency exchange and its CEO, bringing the native token BNB to a multi-month low.

Also read - Binance and CEO CZ sued by CFTC for violating federal laws; Binance Coin price crashes by 6%

Binance Coin price crashes

Binance Coin price is trending downwards at the time of writing, trading at $273. Down from $305, the cryptocurrency is facing panic selling from investors resulting in a 10% crash in the span of a few minutes.

BNB/USD 1-day chart

BNB/USD 1-day chart

Earlier on May 5, the SEC filed a lawsuit against the exchange and its CEO, Chengpang Zhao (CZ). The regulatory body claimed that the accused were in violation of securities law in the process of claiming BNB and BUSD to be securities. The SEC noted that Binance, its US arm and the CEO offered these unregistered securities to the general public.

At the same time, the company was also accused of allowing citizens of the United States to operate on the primary platform (Binance.com) other than Binance.US. The SEC stated,

"As a second part of Zhao's and Binance's plan to shield themselves from US regulation, they consistently claimed to the public that the Binance.com Platform did not serve US persons, while simultaneously concealing their efforts to ensure that the most valuable US customers continued trading on the platform.

Furthermore, the suit alleged that the accused commingled and diverted billions of dollars of customer funds to a third-party entity owned by CZ as and when they pleased. The SEC claimed that the users' crypto and fiat assets were moved around by Binance in ways other registered brokers would not.

Binance responded to these allegations, stating,

“While we take the SEC’s allegations seriously, they should not be the subject of an SEC enforcement action, let alone on an emergency basis. We intend to defend our platform vigorously.  Unfortunately, the SEC’s refusal to productively engage with us is just another example of the Commission’s misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry.

Additionally, the CEO of the company CZ responded with his trademark "4". The number is a code for all things FUD, fake news, attacks, etc., against the organization, adding.

"Our team is all standing by, ensuring systems are stable, including withdrawals, and deposits. We will issue a response once we see the complaint. Haven't seen it yet. Media gets the info before we do.


Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Join Telegram

Recommended content

Recommended Content

Editors’ Picks

Bitcoin active addresses hit lowest level in five years, BTC ranges below $67,000

Bitcoin active addresses hit lowest level in five years, BTC ranges below $67,000

Bitcoin (BTC), the largest asset by market capitalization, has noted a decline in its active address count per data from Glassnode. A decline in active addresses is typical at a time during a surge in Bitcoin transaction fees.

More Bitcoin News

SEC vs. Ripple lawsuit update: Regulator responds to letter regarding Terraform Labs judgment

SEC vs. Ripple lawsuit update: Regulator responds to letter regarding Terraform Labs judgment

Securities and Exchange Commission (SEC) responded to Ripple’s letter that quotes the reasons for the settlement amount being unreasonable. The payment firm had proposed a fine of $10 million, as opposed to the SEC’s $2 billion. 

More Ripple News

Gemini Earn creditors could recover their funds in coin as New York Attorney General recovers $50 million

Gemini Earn creditors could recover their funds in coin as New York Attorney General recovers $50 million

Gemini exchange had terminated its Earn program after Genesis Global Capital did not return over $900 million in assets that it owed to the platform. New York Attorney General Letitia James’ office has recovered a total of $2.05 billion from the platform.

More Cryptocurrencies News

Here’s what you need to know about LayerZero ZRO token airdrop

Here’s what you need to know about LayerZero ZRO token airdrop

LayerZero Labs CEO Bryan Pellegrino released details of the upcoming ZRO token airdrop in a recent tweet. ZRO total supply is 1 billion of which 23.8% will be directly allocated to the community and builders. LayerZero announced June 20 as a key date, it remains unclear whether this is the airdrop or entitlement date. 

More Zro News

Bitcoin: Has BTC found a local price bottom?

Bitcoin: Has BTC found a local price bottom?

Bitcoin (BTC) price looks set for a mild fall this week, weighed by slight outflows in the US spot ETFs and the US Fed keeping a hawkish interest-rate outlook despite easing inflation. Technical indicators suggest that BTC could face a further 5% correction in the short term before resuming the uptrend.

Read full analysis