Mar 27, 2023
Crypto Prices Drop as CFTC Sues Binance Over Trading Violations
(Bloomberg) -- Bitcoin touched a 10-day low and smaller cryptocurrencies also declined after Binance Holdings Ltd. was sued by the US Commodity Futures Trading Commission for allegedly breaking trading and derivatives rules.
Binance, which exploded onto the crypto scene in 2017 and almost immediately took on and surpassed larger rivals, saw its market share surge after last November’s collapse of FTX. It accounts for about 60% of crypto spot and derivatives trading volume. The company has argued that the global exchange is not subject to US jurisdiction because it has no headquarters.
“Right now, the big question I’m wondering is whether there will be other, criminal charges against them,” said Omid Malekan, an adjunct professor at Columbia Business School. “Ultimately everyone has been expecting some crackdown against Binance from the US government.”
Bitcoin, the largest cryptocurrency by market value, fell as much as 3.9% to $26,722. Binance’s BNB token fell about 3.5% to $315.70. So-called altcoins also declined, with Cardano dropping 3.1%, Solana slipping 5% and Polygon sliding 4.4%.
The CFTC is one of several US bodies that have been investigating Binance’s activities. The Internal Revenue Service, as well as federal prosecutors, have been examining Binance’s compliance with anti-money laundering obligations, Bloomberg News has reported. The Securities and Exchange Commission has been scrutinizing whether the exchange has supported the trading of unregistered securities.
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