- The Securities & Exchange Commission’s lawsuit against Binance is hurting the listed tokens on Coinbase, Kraken and other US exchanges.
- Arca’s chief investment officer says that US-based crypto exchanges must decide whether to delist many tokens.
- SEC’s legal battle with Binance has wiped out $50 billion from total crypto industry market capitalization overnight.
The Securities & Exchange Commission (SEC), the premier US financial regulator, now controls $115 billion in cryptocurrencies with its lawsuit against Binance. In its latest move against Binance Holdings Ltd., the regulator expanded a list of digital tokens deemed unregistered securities, unnerving investors on US-based exchanges like Coinbase and Kraken.
Also read: Binance and CEO face 13 charges by the SEC, citing securities laws violation
SEC expands regulatory net, experts predict losses in crypto tokens
The SEC expanded its regulatory net to cover $115 billion in different cryptocurrencies after its latest lawsuit against Binance. The financial regulator’s allegations against Binance Holdings Ltd. and CEO Changpeng Zhao are related to deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.
Arca Chief Investment Officer Jeff Dorman argues that the regulator’s crackdown on Binance is hurting crypto tokens listed on Coinbase, Kraken and other US-based cryptocurrency exchanges.
The SEC alleges that the following crypto assets traded on Binance’s exchange platform are securities:
Binance Coin (BNB), Binance USD (BUSD), Solana (SOL), Cardano (ADA), Polygon (MATIC), Filecoin (FIL), Cosmos Hub (ATOM), Sandbox (SAND), Decentraland (MANA), Algorand (ALGO), Axie Infinity (AXS) and COTI (COTI)
SEC allegations against Binance
With the SEC’s crackdown on these assets, other exchanges targeted with similar charges and allegations like Coinbase are likely to delist these tokens, plunging the crypto ecosystem into a renewed winter.
SEC wipes out $50 billion in crypto market capitalization
The regulator’s legal tussle with crypto exchanges and its views on tokens considered as securities has wiped out over $50 billion in market capitalization overnight. Based on data from CoinGecko, the total crypto market capitalization of the ecosystem lost more than 4% of its value between Monday and Tuesday.
Total crypto market capitalization data from CoinGecko
The designation of cryptocurrencies as securities brings in investor protection rules and other regulations that are likely to pose a challenge in trading these assets on exchanges. Cryptocurrency trading platforms are likely to shy away from listing assets deemed securities for fear of regulatory violation.
At the time of writing, the combined market capitalization of the assets named as securities by the SEC is $85.3 billion.
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.
Recommended Content
Editors’ Picks
US presidential election outcome could shape the future of crypto
US citizens will go to the polls to elect a new president on November 5, and their choice could be key for the future of the crypto industry and thus the price outlook for Bitcoin (BTC).
Bitcoin Price Forecast: BTC recovers as Donald Trump takes lead on polls
Bitcoin (BTC) slightly recovered to around $68,800 on Tuesday, following a shift in the United States presidential race that saw former President Donald Trump regain the lead, after US spot Bitcoin ETFs experienced an outflow of over $540 million on Monday.
Crypto markets brace for volatility in tight race between Trump and Harris
The US presidential election is one of the most significant events in the world. Due to the influence of the country’s political decisions, policies, and economic approaches, it can significantly impact crypto and global markets.
Trump-inspired memecoin MAGA shows bullish on-chain metrics ahead of US elections
MAGA (TRUMP) trades slightly down to around $3.4 on Tuesday after rallying more than 20% since Sunday. The former President Donald Trump-based memecoin is poised for further gains as daily active addresses and network growth metrics rise, signaling increased network usage and adoption
Bitcoin: New all-time high at $78,900 looks feasible
Bitcoin price declines over 2% this week, but the bounce from a key technical level on the weekly chart signals chances of hitting a new all-time high in the short term. US spot Bitcoin ETFs posted $596 million in inflows until Thursday despite the increased profit-taking activity.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.