Norman Reed, acting CEO for Binance.US, publicly expressed criticism towards the U.S. Securities and Exchange Commission (SEC) for labeling their cryptocurrency exchange as a “cauldron of fraud,” despite lacking concrete evidence in court to support this claim. In a recent interview, Reed explained that the SEC’s accusations and subsequent actions have had a detrimental impact on the company’s business, resulting in substantial financial losses, layoffs, and tarnished reputation.
Background
In June 2023, I found myself at the heart of a contentious situation as the SEC, prompted by the aftermath of FTX’s downfall, filed a lawsuit against Binance, Binance.US, and its founder Changpeng Zhao (CZ). Although Binance managed to strike a $4.3 billion settlement with US authorities, Binance.US was not included in this accord. Instead, it had to navigate its own regulatory challenges, such as strained banking ties and the termination of fiat services.
Previously employed at the SEC for enforcing securities laws, Reed now views the regulatory body’s actions towards Binance.US as a focused assault. Shortly after the lawsuit was filed, the exchange experienced a wave of customer departures and massive withdrawals worth billions of dollars. The consequences were far-reaching, leading to major institutions and banks cutting ties with Binance.US, significantly impacting its capacity to function as a crypto-to-fiat platform.
Binance.US Charts a Path to Recovery
Even with the challenges, Reed emphasizes that the company is primed for a comeback. He repeated his intention to reintroduce USD transactions soon, as discussions are ongoing with banks and regulatory bodies. This move signifies a significant leap forward for the exchange, which has been subject to tight limitations since mid-2023.
Furthermore, the temporary leader commended the Binance.US team’s tenacity. He expressed that the company’s ability to endure and ultimately thrive could become a notable example in the cryptocurrency sector.
Regardless of the comments made by Richard Teng, CEO of the global entity, suggesting that talks about Binance’s return to the U.S. market are too early, there is still a possible path for their comeback.
Reed additionally drew attention to the larger scenario associated with “Operation Chokepoint 2.0”, a term referring to alleged attempts by regulators to restrict cryptocurrency businesses. In his view, the SEC’s actions against Binance.US can be seen as contributing to this narrative, aiming to tarnish its reputation and impose operational challenges on it.
A representative from Binance.US noted that although their platform has been under examination by several U.S. authorities like the Department of Justice and the Commodity Futures Trading Commission, only the Securities and Exchange Commission (SEC) has taken any action against them so far.
In the coming administration of President-elect Donald Trump, the wider cryptocurrency community anticipates a defined and cryptocurrency-friendly regulatory landscape. Similarly, Reed shows optimism regarding a supportive regulatory climate as SEC Chair Gary Gensler is set to leave the agency.
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2025-01-14 13:54