There are reports that the US SEC has launched a probe into Binance and all crypto exchanges in the United States. The regulator decided to increase the tempo of its oversight functions of the digital assets sector recently.
Exchanges Under the Radar
A staff member in the office of Senator Cynthia Lummis said the SEC is keeping a tab on Coinbase and a number of other crypto exchanges. Forbes released a report on Thursday that quoted the anonymous staffer that claimed Binance is also under the SEC’s watch.
The source said further that the SEC is working hard to set itself as the primary regulator of the crypto space. Note that the SEC is contending with the CFTC for the industry’s regulator.
The CFTC has controlled the digital asset space since 2014. The SEC, however, came up in recent years to assert itself over the space.
The SEC’s Chairman, Gary Gensler, said many times that a lot of crypto tokens might be classified as unregistered securities. The agency went ahead to give its strongest indication yet that it’s going to work hard on the market.
The SEC has a lawsuit where it alleges that a former employee of Coinbase along with two others was involved in insider trading. The Commission claims that Coinbase allows users to trade a number of unregistered securities.
The allegation of insider trading against Coinbase’s employee(s) sent a shockwave throughout the industry. The Commission’s allegation was also noteworthy because it hadn’t gone after exchanges due to their tokens before.
The CTFC Might Get Back Stronger
After there was news that the Commission was probing Coinbase, Binance US moved to delist one of the tokens in question, AMP.
The Commission’s shaking did not end with Coinbase. Since Coinbase’s insider trading saga, Gensler said he doesn’t see any difference between stock trading platforms and crypto exchanges. He added that there are always conflicts of interest when exchanges are also the market makers.
The Commission sued 11 people said to be behind Forsage. It is said to be a cryptocurrency pyramid plan that made investors lose up to $300 million.
The SEC has been intensifying its effort to properly regulate the crypto space. The CFTC equally has got another means of setting up further oversight in the space.
The Senate Committee on Agriculture sponsored a bill on digital commodities. If it gets passed, the bill will have Bitcoin and Ethereum qualified as commodities. It will then put the CFTC in charge of exchanges that list those assets as commodities.