SEC Sues Binance and Changpeng Zhao Over Alleged Securities Violations

The U.S. Securities and Exchange Commission is suing Binance and its founder, Changpeng Zhao, alleging the largest cryptocurrency exchange in the world lied to regulators and misused customer funds. The 13-count complaint claims Binance diverted customers’ money to a European company controlled by Zhao and subverted its own controls to let U.S. customers trade on the platform. It also claims that while the company presented Binance.US as a separate trading platform for U.S. customers, Zhao and Binance “secretly controlled the Binance.US platform’s operations behind the scenes.” The allegations follow a similar complaint from the CFTC in March, as U.S. regulators increasingly crack down on crypto trading. Zhao responded to the news in a tweet, writing: “Our team is all standing by, ensuring systems are stable, including withdrawals, and deposits. We will issue a response once we see the complaint. Haven’t seen it yet. Media gets the info before we do.”