Since the SEC set its sights on Binance.US, the American subsidiary of the American exchange Binance has been living through long weeks of uncertainty. After filing a 136-page complaint on 13 different counts, the US Financial Markets Authority had demanded a total freeze of Binance’s assets. US for 10 consecutive days, thus casting the shadow of a possible bankruptcy of the juggernaut. In living memory, this is the toughest action the SEC has taken against an exchange. More than a month after this complaint, how is the BNB doing? Is the token destined for imminent death? Details.
Binance no longer has the right to access the assets of Binance.US customers
More than a month ago, the crypto universe was rocked by the BNB attack by the SEC which, two months earlier, crucified BUSD, Binance’s stablecoin. In a 136-page complaint filed in federal court in Washington, the US Securities and Exchange Commission (SEC) accused the exchange of failing to register as a stock exchange platform in the United States.
The regulator blamed it for allowing US users to access the Binance.com global platform instead of Binance.US, which is the regularly registered US subsidiary.
The SEC considers more than 60 cryptocurrencies listed on Binance, including BNB, Binance’s native token, as securities that must be registered as such.
Intractable, the SEC had asked the federal court in the District of Columbia for an authorization to freeze all of Binance’s assets for 10 days, a request that Binance.US described as “unreasonable and illogical”.
Fortunately, there was more fear than harm. On June 17, Binance.US informed the Twittersphere that “The Court did not grant the SEC’s request for the interim order and the freezing of our platform’s assets, which was clearly unjustified both from a factual and a legal point of view. On the contrary, we were able to enter into a court-ordered agreement with the SEC that allows us to continue our current operations.
In fact, the agreement imposes restrictions on Binance and Binance.US to ensure that the assets of Binance.US customers will be protected and kept in the United States and will not be transferred abroad, in accordance with the consent order.
Under this agreement, only Binance.US employees will be able to access customer funds on Binance.US. Binance Global representatives will therefore not be able to access the private keys associated with all Binance.US wallets.
Following a court ruling, Binance.US reactivated fiat trading that had been halted days after the SEC complaint. Unfortunately, a month later, the BNB continues to feel the negative effects of the regulator’s offensive.
BNB loses 1% of its value and Binance.US loses 20% of market share
Even if the threat posed by the SEC has been dismissed, this affair has not left the exchange completely unscathed. Binance.US has also acknowledged that “this fight has damaged our operations and our reputation”.
It is noted, despite the vigorous measures taken by Binance. US to avoid a bank run and massive withdrawals, that BNB has still not regained its pre-June 5 shape.
In the aftermath, the exchange lost nearly 20% of its market share and nearly 1% of its price. Just take a look at the BNB price chart on Coinmarketcap for the period from June to July to realize this.
On June 5, 2023, when the SEC filed the complaint, BNB was worth approximately US$305.634 on CoinMarketCap. The next day, the price rose to nearly $277.09 before dropping to around $246.083 on June 12. On July 20, the price of BNB fell lower, reaching $240.309.
Moreover, since the beginning of this affair, the news relating to Binance.US has not been very encouraging. Apart from the departure on July 6 of Patrick Hillmann, the chief strategist of Binance, we learned that the crypto exchange would have stopped offering its employees the reimbursement of certain expenses.
This information comes after Binance announced that it was laying off more than 1,000 employees in the space of a few weeks for business and regulatory reasons. It is obvious that Binance.US is looking for urgent solutions to minimize costs and regain its financial shape affected by this altercation with the American regulator which will have caused it to lose nearly 20% of market share.
BNB: what to expect in the coming weeks?
Coming after the episode of FTX and BUSD, the uncertainty hanging over the future of BNB favors the fall in value of the cryptocurrency. Although the court has already ruled on the matter, the price of the token is still close to the x-axis on the charts.
We must believe that some investors had to invest in other more promising assets at the time, knowing the temerity of the SEC on this type of case. What is certain is that the value of a utility token depends first on its usefulness. It is clear that BNB will continue to serve as a utility token for the payment of network fees for crypto services accessible on Binance.
On the other hand, Binance customers will continue to use their BNB to benefit from the various benefits, such as discounts, associated with owning this token.
As long as BNB retains its usefulness for crypto operations, we can rest assured about its future. No need to panic. The price of the cryptocurrency will undoubtedly recover its form and perform better in the coming weeks. Binance is the first exchange in the world and intends to remain so!
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