Sigma

Gary

<p>After the CFTC, it’s now the SEC’s turn to go after Binance and its founder Changpeng Zhao (CZ).</p><div class="thumbnail post-cover-image"><img src="https://www.cointribune.com/app/uploads/2023/06/Polygon-deutsche1-1024x683.png" srcset="https://www.cointribune.com/app/uploads/2023/06/Polygon-deutsche1-1024x683.png 1024w, https://www.cointribune.com/app/uploads/2023/06/Polygon-deutsche1-300x200.png 300w, https://www.cointribune.com/app/uploads/2023/06/Polygon-deutsche1-768x512.png 768w, https://www.cointribune.com/app/uploads/2023/06/Polygon-deutsche1.png 1200w" sizes="(max-width: 1024px) 100vw, 1024px" class="post-cover-image--img" alt="Binance Changpeng Zhao (CZ)"></div><div class="my-4"></div>



<h2 id="h-binance-and-changpeng-zhao-targeted-by-the-sec">Binance and Changpeng Zhao targeted by the SEC </h2>



<p>The SEC has filed a lawsuit against Binance, the world’s largest exchange with over 200 million customers (Binance.com).</p><div class="my-4"><div class="ads ">
    </div>
</div>



<p>US subsidiary (BAM Trading Services) that operates Binance.US is also implicated, as well as Changpeng Zhao himself.</p>



<p>The <a href="https://www.sec.gov/news/press-release/2023-101" target="_blank" rel="noreferrer noopener">SEC</a> claims that Zhao and Binance did not prohibit US customers from trading on Binance.com, contrary to what had been publicly stated. Important US customers secretly obtained special privileges.</p>



<p>Although CZ and Binance publicly stated that Binance.US is a separate entity dedicated to US investors, the SEC alleges that CZ <a href="https://www.cointribune.com/mais-ou-se-trouve-le-hq-de-binance/" target="_blank" rel="noreferrer noopener">secretly</a> controlled the operations of the Binance.US platform behind the scenes.</p>



<p>More concerning is that Zhao and Binance would exercise such control over the assets of US customers that they could “<em>divert customer assets as they please, including to an entity Zhao owned and controlled called Sigma Chain.</em>”</p>



<p>The company Sigma Chain allegedly engaged in transactions aimed at artificially inflating trading volume on the exchange. Worse yet, CZ would have sent “<em>billions of dollars of assets belonging to his clients to another company named Merit Peak, also owned by Zhao.</em>”</p>



<p>Binance is also accused of failing to comply with securities laws, particularly regarding the BNB and BUSD tokens, certain cryptocurrency lending products, and staking services.</p>



<p>“<em>Through thirteen charges, we allege that Zhao and Binance entities engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law,</em>” says Gary Gensler, SEC Chairman.</p>



<p>“<em>Zhao and Binance misled investors about their risk controls and corrupted trading volumes while actively concealing who was operating the platform, the manipulative trading of its affiliated market maker, and even where and with whom investor funds and crypto assets were custodied.</em>”</p><div class="my-4"><div class="ads ">
    </div>
</div>



<p>“<em>We allege that Zhao and the Binance entities not only knew the rules of the road, but they also consciously chose to evade them and put their customers and investors at risk—all in an effort to maximize their own profits,</em>” said Gurbir S. Grewal, Director of the Enforcement Division.</p>



<p>The noose tightens around the king of shitcoins. The BNB has been in free fall since the announcement of the lawsuit.</p>

SEC charges Binance and CZ

Table of Contents

Cointribune EN

Other articles published on Jun 6, 2023

Binance Lawsuit: 61 Cryptocurrencies are Now Seen as Securities by the SEC

SEC vs. Ripple case: Legal expert predicts resounding 75% victory

JPMorgan Embraces Blockchain for Effortless Settlement of US Dollar Forex Trades in India

The Revolutionary Fusion of Augmented Reality and NFTs: A New Realm of Digital Interaction

MASSIVE POTENTIAL – This Project is Outperforming Ethereum

Buterin moves ETH to Kraken shortly before Binance suit announced

Join our free newsletter for daily crypto updates!