Earlier this week, SEC chief Gary Gensler formalized legal action against Binance. The company has taken note of this and is already raising an element that could destroy the legitimacy of the boss in this case.
Gary Gensler, illegitimate to sue Binance?
The case has been in the news since Monday, June 5. Binance, a major firm in the American crypto industry, is being sued for fraud by the SEC. Lawsuits that promise to be long-term since the company in question wants to defend itself.
Obviously, the company does not want to waste its time to restore its damaged credibility. This Thursday, June 8, the company’s defense revealed the illegitimacy of the person responsible of the SEC to sue her.
This argument is based on a potential conflict of interest in the file. In this case, Binance lawyers raise close ties between the company and Gary Gensler. According to representatives of the firm, the chairman of the SEC would have provided consulting services to Binance.
These services would be directly related to Binance’s regulatory compliance policy. The decision to provide them would be the result of a meeting between Changpeng Zhao (CZ), the CEO of Binance, and Gensler.
Following this meeting which would have taken place in March 2019 in Japan, Gensler would have “offered to serve as an adviser” at Binance. A process by which the manager “acknowledged regulatory uncertainty around cryptos”.
These allegations throw a stone into the pond of a legal battle which is just beginning. Because if these facts are proven, the boss of the SEC will have no choice but to consider withdrawing from the file. A challenge that would be certain if the judge recognizes its relevance.
In the shadow of the growing controversy around Gensler, including rumors of market manipulation, Binance’s attorneys clearly want to keep Gensler out of the case. Their argument: “Gensler should have been recused from consideration in this case due to his history with Binance and the possibility that he could be a key witness.”, Gensler’s legitimacy is therefore doubly tested. Will he manage to stay the course in the storm or do these allegations sign the beginning of his downfall? The outcome of this legal battle has far-reaching implications for the future of the crypto industry.
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