Binance US Market Depth Shrinks Almost 80% Amid SEC Crackdown
Binance Nigeria
Summary: The SEC filed a lawsuit against Binance and its American sister company, Binance US. Kaiko, a cryptocurrency analytics business, claims that since the SEC complaint was filed last week, market depth on Binance US has dropped by around 80%.
Due to legal issues with U.S. regulators, investors are abandoning Binance and its sister company, Binance US. According to crypto analytics firm Kaiko, market depth on the US sister exchange has decreased by almost 80% since the SEC lawsuit was filed last week.
The SEC filed a lawsuit against Binance and its American sister company on Monday, alleging that Binance CEO Changpeng Zhao commingled user money via a “web of deceit.” Dessislava Aubert, a Kaiko analyst, claims that a significant exodus of market makers from Binance US over the last week has resulted in a near 80% drop in liquidity.
SEC’s Severe Crackdown
Binance claims that the cryptocurrency exchange operating under the same name and brand as itself is a distinct entity. The corporation claims that its US affiliate is a separate organisation, but the SEC’s lawsuit suggests otherwise.
Handpicked News: U.S Congressman Files SEC Stabilization Act to Remove Chairman Gensler
Coinbase is the most widely used cryptocurrency exchange in the US. The SEC followed suit the next day, but with less serious claims. Following an SEC lawsuit, Binance US temporarily suspended U.S. currency deposits.
Hard Time for Crypto Sector
The year 2023 was not kind to cryptocurrencies; after the November 2022 failure of the huge digital asset exchange FTX, U.S. authorities launched a hard attack on the industry, forcing the closure of several companies.
In particular, the SEC has increased its oversight of cryptocurrency businesses it believes are illegally selling securities. Bitcoin’s (the largest cryptocurrency by market cap) meteoric surge this year comes despite the industry’s tightening grasp.
