In a tumultuous September, Binance.US, the American counterpart of the global cryptocurrency giant Binance, has experienced a significant slump in trading activity. The exchange has been grappling with an array of challenges, including executive departures and an ever-intensifying regulatory spotlight.
On September 16, Binance.US reported a mere $5.09 million in exchange volume, marking a stark contrast to its heyday. This sharp drop in trading activity was revealed by Amberdata on The Tie Terminal. Notably, September’s low point occurred on September 9 when trading activity plummeted to a meager $2.97 million, a far cry from the robust $230 million seen on September 17, 2022.
Binance.US Faces SEC Accusations of Non-Cooperation
The woes of Binance.US began when, on June 5, the Securities and Exchange Commission (SEC) launched a lawsuit against both Binance and Binance.US. The charges included allegations of unregistered securities offerings, wash trading, and other violations. According to the SEC, Binance.US failed to register as a broker-dealer and neglected to register its staking-as-a-service program.
In response to the legal action brought out in the form of a lawsuit, Binance.US made the fairly significant and noticeable decision to suspend trading activities for a large number of more than 100 token pairs. This particular line of action had a significant and notable contribution to the marked reduction in overall exchange activity.
Binance.US is not only grappling with external pressures but is also facing internal turmoil. Brian Shorder, the former CEO of Binance.US, recently stepped down, joining a growing list of global executives who have departed from the Binance group of companies in recent weeks. Following Shorder’s exit, the head of legal, Krishna Juvvadi, and the chief risk officer, Sidney Majalya, also announced their resignations.
Speculation abounds that these departures are linked to an ongoing investigation by the U.S. Department of Justice into Binance, its CEO Changpeng “CZ” Zhao, and Binance.US. In response to rumors surrounding Shorder’s departure, CZ stated on X (formerly Twitter) that the executive was taking a “well-deserved break” and acknowledged his significant contributions to the company’s growth.
The troubles facing Binance.US seem to be far from reaching a resolution. In the latest development, the Securities and Exchange Commission (SEC) has accused the exchange of showing a lack of cooperation in the ongoing investigation. The SEC’s claim that Binance.US produced a mere 220 documents during the discovery process raises concerns about transparency and compliance, adding another layer of complexity to the regulatory battle.
Unsealed Documents Shine Light on Ongoing Legal Battle
Furthermore, on September 15, a court granted an order granting the SEC’s demand to unseal records that had previously been sealed or highly redacted. These documents, which were previously hidden at the request of the SEC, are now scheduled to be released to the public and regulators alike. The contents of these released documents have the potential to give light on the nature and breadth of the alleged violations, providing greater insight into the complexities of the ongoing legal conflict between Binance.US and the SEC.
These critical documents are expected to play a pivotal role in setting the trajectory of the regulatory inquiry and its potential ramifications for both Binance.US and the larger cryptocurrency industry when they become available in the coming days.