Regulation in the crypto market and the imminent regulatory battle have put the market on alert. In this article, we will discuss the recent actions taken by the U.S. Securities and Exchange Commission (SEC) against prominent companies such as Binance US and Coinbase, accused of operating trading platforms illegally. Additionally, we will discuss the defense presented by Binance US and the hiring of a former co-director of the SEC for their legal team. We will also analyze the impact of these events on Bitcoin, which faces a scenario of indecision while dealing with regulatory turbulence and potential consequences for the market. Stay updated on the latest developments and perspectives regarding the cryptocurrency market in the face of these regulatory challenges.
The regulatory battle has put the crypto market on alert.
After a period of intense pressure on cryptocurrencies in the United States, the SEC made strong statements this week. On June 5th, the SEC initiated a lawsuit against Binance US and CZ (Changpeng Zhao – CEO of Binance), alleging that they were operating a trading platform illegally. Then, within a span of just 24 hours, the SEC also filed a lawsuit against Coinbase for the same reasons. Furthermore, 11 U.S. states issued orders to halt operations, demanding that these companies prove within a 28-day period that they were not involved in the sale of unregistered securities. If they fail to prove their compliance, they will be required to suspend their activities in those states. These actions represent a significant setback for major market companies such as Binance, the largest global exchange, and Coinbase, the largest exchange in the United States.
SEC’s offensive and its impact on the crypto market.
Last week, the SEC filed an emergency motion in the Federal Court of Washington, seeking to freeze the assets of Binance US, both in fiat currency and cryptocurrencies. The partnership with American banks was terminated, making any form of settlement by American customers unviable. It was a shock to the market, which reacted immediately by causing a downturn in the altcoin market. Although Bitcoin also experienced a decline, the drop was not as significant as that of other cryptocurrencies.
According to an article published by Bloomberg on June 12th, Binance.US announced the hiring of George Canellos, former co-director of the SEC’s enforcement division, to join their legal team responsible for preparing the company’s defense against the allegations of operating as an unregistered trading platform.
Binance US contested the proposed temporary restraining order by the U.S. Securities and Exchange Commission (SEC) in court, which seeks to freeze the exchange’s assets. The company argued that such a measure would effectively halt its operations in the United States.
In its defense presented on June 12th, Binance.US criticized the SEC’s emergency motion, which requested a temporary restraining order on the exchange’s assets, referring to this request as “draconian and unduly burdensome.”
With all the regulatory turbulence we are currently experiencing, the BTC/USD pair remains consolidated in the same area of indecision after last week’s decline. Bitcoin has found support at the strong 200-period moving average on the daily chart and, below that, at the psychological level of $25,000. Despite the challenges faced by the market, the sentiment is still optimistic. This type of lawsuit tends to have a quicker resolution in the U.S., and depending on the outcome, we could resume trading above $27,000, especially if inflation data in the U.S. remains under control. However, there is a possibility of a strong bearish scenario if Binance US is severely penalized and has to cease its operations in the American territory.
For now, it is important to remain vigilant: it would be interesting to carry out buying operations with a short stop between $25,000 and $25,200.