Regulations across the crypto market are one reason why the market is still seeing some level of decorum regarding frauds and scams. While some few other countries have not agreed to crypto adoption due to these, others have out structures to tackle malicious acts or suspected flouting of orders in the sector.
In a recent publication, the United States Commodities and Futures Trade Commission has announced that it is currently investigating a famous crypto exchange, Binance. In the memo released, the CFTC mentioned that Binance allowed its citizens to trade derivates without going through the standard accreditation and registration processes.
The report claims that Binance won’t be charged yet
Despite the CEO of the crypto exchange, Changpeng Zhao, branding the allegations as a case of FUD, the market has reacted swiftly to the news, seeing a sharp decline in the last few hours. Pointing out the case of familiar entities, Bloomberg has reported that the CFTC is still getting a good look at the evidence before they determine if, indeed, Binance was guilty of breaching the rules of crypto trading in the country.
Moreso, Bloomberg mentioned that the regulator wants to establish that Binance allowed users on its platform around the country to trade derivatives without due registration with the entity. With the allegations looking possible, the report claimed that Binance has not officially been accused of carrying it out as they are still making their findings and are hoping to find evidence soon. If they are found guilty in the investigation, it might not necessarily mean that the firm would be sanctioned. As previously stated, the CFTC has recognized major digital assets like Bitcoin as commodities and frowns on entities allowing users to trade them without proper registration.
Binance promise to collaborate with regulators
In a statement by the spokesperson of Binance, he mentioned that they are well aware of the allegations and do all they can to collaborate with the regulator. He also pointed out that they are also willing to work with regulators worldwide to show that they are very serious about rules and regulations across all jurisdictions. On his part, Changpeng Zhao, the CEO of Binance, stressed that the allegations were just a bull market that lacked FUD and the users should not worry about them.
FUD is a term in the crypto space that is used to describe fear amongst traders and investors. A short while after the news went viral, most top digital assets, including Bitcoin, saw major dumps to end the day. Bitcoin saw about $1,500 shaved off its value as the digital asset registered to trade around $55,000. As expected, Bitcoins fall was nothing compared to that of Binance coin as the digital asset saw a 10% drop to register a price sale of $250 from $275. In a similar fashion to Bitcoin, which has reacted to establish an all-time high, the Binance coin has also seen some price surge.