Web3's "biggest shock", US regulatory iron fist hitting Coinbase and Coinbase

Comprehensive report

7minread

Web3's "biggest shock", US regulatory iron fist hitting Coinbase and Coinbase

Core 2023/06/07

abstract

136 page report, knife fatal.

The Web3 bear market is over, and regulatory iron fists are rushing in.

On June 5th and 6th local time, the United States Securities and Exchange Commission (SEC) filed a series of accusations against the two most well-known cryptocurrency exchanges in the world, Coinon and Coinbase.

In a 136 page report, the SEC filed multiple securities law violations charges against Coin An and its founder Zhao Changpeng.

'We accuse Zhao Changpeng and the Coin Security entity of engaging in a series of deceptions, conflicts of interest, lack of disclosure, and systematic evasion of the law.'SEC Gary Gensler '.'

On the 6th, the SEC announced a series of new charges against Coinbase, which is headquartered in the United States. The accusation is that Coinbase operates an unlicensed stock exchange, brokerage, and clearing house, illegally promoting the sale of billions of dollars in crypto asset securities.

Important accusations against Qian An:

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Strike result:

Investors withdrew $790 million from the accounts of Coin An and its subsidiaries;

The stock price of 2Coinbase fell by over 12% on the same day.

Last year, the collapse of the cryptocurrency empire FTX caused a huge shock in the coin industry, and the price of Bitcoin fell by nearly 25% in just a few days. Since then, regulatory agencies have intensified investigations into cryptocurrencies, and Zhao Changpeng's competitor, FTX founder Sam Bankman Fried, has also been accused of securities fraud, money laundering, and other crimes.

Now, the two enforcement actions of the SEC are targeting the two giants in the currency industry. Is the cold winter of the currency industry coming?

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SEC Gurbir S. Grewal '.'

SEC website posted 13 accusations against currency security entities | SEC

The SEC's allegations have several key points:

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The SEC's indictment states that since July 2017, Binance.com, Binance.US, and BAMTrading have operated as exchanges, brokers, distributors, and clearing houses under Zhao Changpeng's control, earning at least $11.6 billion in revenue from trading fees for US clients, but have not been legally registered.

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In 2019, Coin On faced regulatory crackdowns in the United States due to multiple potential violations, announcing restrictions on US users' access to Binance.com and launching Binance.US, which is subject to US law and provides less cryptocurrency and digital assets than the former. However, the SEC's indictment points out that although Coin An publicly prohibits American investors from using Binance.com, behind the scenes, Zhao Changpeng instructed Coin An to assist certain high-value American clients in bypassing those control measures and conducting them in a secret manner.

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Due to a lack of regulation, the SEC believes that Coin An and Zhao Changpeng can freely transfer investors' cryptocurrency and fiat currency assets, mix and misappropriate these assets:

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Coin An Official Blog Sends a Public Letter in Response to SEC Accusations | Coin An

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Source of header image: RollingStone

Web3 cryptocurrency Coinbase