SEC sues Binance over US securities rule violations, Binance responds.

On Monday, June 5th, the US Securities and Exchange Commission (SEC) filed a lawsuit against the world’s top cryptocurrency exchange, Binance, for violating securities laws. The SEC also accused Binance of mishandling investor funds, misleading investors and regulators, flouting KYC rules, and letting Americans trade in an unsecured and unprotected environment.

In the SEC’s filing with the US federal court in Washington, Gurbir S. Grewal, Director of the SEC’s Division of Enforcement, wrote, “We allege that Zhao and the Binance entities not only knew the rules of the road, but they also consciously chose to evade them and put their customers and investors at risk – all in an effort to maximize their own profits.”

The SEC complaint also accuses Binance of creating Binance.US as a shield for the main company. Binance called the SEC action “disappointing” and intends to defend its platform vigorously.

Interestingly, the SEC has cited two former Binance CEOs who expressed concerns over Zhao’s level of control. Several crypto industry members have intended support for Binance. Cardano chief Charles Hoskinson said that it’s time for crypto players to unite and fight against the SEC’s authoritarianism.