Is SEC Trying to Hurt the Industry by Tagging Binance.US Unregistered?
- A crypto influencer said the regulator was seeking to mitigate further casualties.
- Ben Armstrong believes the issue affects all Web3 asset managers.
The crypto community is divided over the aims and objectives of the US Securities and Exchange Commission (SEC) in concluding that the Binance US subsidiary was operating an unregulated securities exchange.
Mike Alfred, a crypto influencer who started the conversation on Twitter, argued that the SEC was not trying to regulate securities because they wanted to hurt the people or the crypto industry. Citing the bankruptcy cases of Celsius, Blockfi, Voyager, and FTX, Alfred concluded that crypto enthusiasts have already been harmed and that the regulator was seeking to mitigate further casualties instead.
Famous crypto promoter Ben Armstrong argued that it was not about Binance.US alone but every asset manager in the Web3 industry. A Twitter user with the username @SuperElonMars commented that the SEC and its chairman Gary Gensler aimed to change precedents outside the law. Given that exchanges are not selling initial coin offerings, SuperElonMars cited the judge in the library case as saying secondary sales are not securities.
In another conversation, crypto analyst Adam Cochran contended that the US regulator was playing a game of “brutal 4D chess” against Binance, the largest crypto exchange. The analyst believes that the SEC’s move was calculated and designed to force Binance to settle the matter or face the prospect of discovery by a US agency.
Last month, the SEC issued a Wells Notice to Paxos Trust Co, the issuer of the Binance stablecoin BUSD, informing the firm of an impending action for selling an unregulated security.