Gary Gensler faced the press to explain the heavy charges brought by the SEC against the exchanges Coinbase and Binance.
Security or not?
Coinbase CEO Brian Armstrong probably regrets inciting the US Congress to put pressure on Gary Gensler. The chairman of the SEC responds this week in a brutal way.
As a result, Coinbase has just been asked by 10 American states to explain themselves. The NASDAQ-listed exchange has 28 days to demonstrate why it should not be banned from continuing operations.
BinanceUS risks seeing the funds of all its customers frozen if justice gives the green light. Note that funds held on binance.com are not affected.
The SEC Chairman took to CNBC and Bloomberg to explain:
“These exchanges combine a number of functions that are not seen in traditional finance. Indeed, the New York Stock Exchange does not manage an investment fund in parallel nor does it have its own market makers. But that is precisely what Binance does through sister organizations that flood the platform with transactions. This is called wash trading. »
[Le wash trading consiste à faire croire aux investisseurs que les volumes d’échange d’un titre sont plus élevés qu’ils ne le sont réalité afin d’attirer le chaland. C’est illégal aux États-Unis.]
“Binance customers don’t even know who has custody of their funds. Are they kept here or abroad? We know that billions of dollars in customer funds have been transferred to Merit Peak. We accuse CZ of controlling Merit Peak as well as Sigma Chain, a market maker that artificially inflated volumes. »
For Gary Gensler, CZ “trade against its clients” through these companies.
“We don’t need more digital currencies”
On whether cryptos are just a gigantic ponzi, Gary Gensler did not say no:
“The SEC has decided to remain neutral, but we have to ask ourselves questions. There is a lot of debate as to whether these tokens really have any use. We don’t need more digital currency. We already have a digital currency, it’s the US dollar, the euro, the yen. They are all digital now. »
“On these exchanges, there are often hundreds of tokens. Coinbase offers around 250 tokens. Even 16,000 tokens via his wallet. Same thing for Binance. All we have to show is that one of these tokens is a security that should have been properly registered with the SEC. We have already highlighted a dozen examples for each of the Binance and Coinbase exchanges. »
[SOL, ADA, MATIC, SAND, CHZ, FLOW, ICP, NEAR, VGX, DASH, NEXO, BNB, BUSD, FIL, ATOM, MANA, ALGO, AXS et COTI]
“It’s up to the public to decide what they want to invest in, but the law says it must be based on proper registration. Without it, the public can’t tell if it’s a scam or a counterfeit. And we know that this ecosystem is filled with peddlers and scammers. »
Bitcoin is the only cryptocurrency that Garry Gensler admits is not a security. In the eyes of the SEC, bitcoin is a “commodity”, just like gold.
Finally, it should be noted that Binance also clashed with the French authorities last week. The exchange was forced to delist a dozen cryptocurrencies, including monero.
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