In early August, sources leaked word that officials with the United State Department of Justice were considering fraud charges aimed at Binance, the world’s largest cryptocurrency exchange. However, they indicated, officials are worried that it could cause a run on the market akin to the November 2022 collapse of FTX.
Those concerns have not deterred the Securities and Exchange Commission or the Commodity Futures Trading Commission from levying their own charges against Binance, which in part accused the exchange and its founder, Changpeng “CZ” Zhao, of allowing Americans to use products they are prohibited from accessing and of manipulating trading volume with a market-maker called Sigma Chain that Zhao “owned and controlled.”
To put the numbers in perspective, at the time of writing, Binance had facilitated $7 billion in trading volume over the preceding 24-hour period. Coinbase facilitated a relatively paltry $970 million, while KuCoin — another well-known exchange — fell short of $350 million.
With markets in flux and lingering questions over whether central banks will pull off a “soft landing” for the global economy in the months ahead, it’s fair to wonder what the implications might be if law enforcement joins regulators in targeting Binance. For feedback, we asked a number of Cointelegraph staffers for their thoughts…
