SEC Accuses Binance of Mishandling Funds and Lying To Regulators (nytimes.com) 21
The Securities and Exchange Commission has accused Binance, the world's largest cryptocurrency exchange, of mishandling customer funds as well as lying to regulators and investors about its operations in a sweeping case filed in federal court on Monday. From a report: The Wall Street regulator said Binance had been mixing "billions of dollars" in customer funds and secretly sending them to a separate company controlled by Binance's founder, Changpeng Zhao. The charges included misleading investors about the adequacy of its systems to detect and control manipulative trading. Regulators also said Binance did not take sufficient steps to restrict U.S. investors from accessing Binance's unregulated exchange.
"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," said Gurbir S. Grewal, director of the S.E.C.'s enforcement division. The nation's top securities regulator filed 13 charges against Binance and Mr. Zhao, better known in the crypto world as "C.Z." The S.E.C. is taking action a little over a month after the Commodities Futures Trading Commission filed its own civil enforcement action against Binance and Mr. Zhao.
"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," said Gurbir S. Grewal, director of the S.E.C.'s enforcement division. The nation's top securities regulator filed 13 charges against Binance and Mr. Zhao, better known in the crypto world as "C.Z." The S.E.C. is taking action a little over a month after the Commodities Futures Trading Commission filed its own civil enforcement action against Binance and Mr. Zhao.
Re:This can backfire... (Score:5, Insightful)
Insider trading harms no one? Really?
So you're fine with CEOs dumping all their stock a day before the company crashes and burns? I mean, according to you, nobody got harmed, right? Except for all the other shareholders that just saw their holding sublimate in a money-fire while the guy accountable for it gets to fly away on his private jet with several hundred million dollars.
And if we started making laws based on what Congress is allowed to do, don't you think that's a pretty shitty way to codify business ethics?
What a fantastically stupid post.
Re: This can backfire... (Score:3)
Re: (Score:2)
I don't think anonymous coward is the sharpest tool in the shed.
There are a lot of tools in that shed using that name....
Re:This can backfire... (Score:5, Interesting)
You've got it right. Let's see, in '08, I wanted to diversify my not-munificent savings. I don't trust stocks, so I wanted bonds. A friend who does this stuff said that GE was offering AAA-rated bonds. By the time the folks at Chase Investments could figure out bonds (???), those were sold out, but they offered me AA-rated bonds from another company.
At the time, I didn't know that for years, companies *paid* to be rated. And they'd *never* have a reason to lie, right?
So I put money into... Lehman Bros. And promptly lost half of it.
Shove your crypto-bro bs where the sun don't shine, "insider trading doesn't hurt anyone".
Mixing customer and company funds (Score:5, Insightful)
The hallmark of every Ponzi scheme.
Crypto is not long for this world (Score:4, Interesting)
The infrastructure for crypto is just too expensive to maintain relative to the value it brings. It can't compete with centralized finance systems. Worse, it is a centralized finance system. There's about 5 exchanges and 6-10 big mining pools (depending on what you want to consider "big") and they can do "51%" attacks with ease. Any gov't that wants to control Crypto just has to put pressure on the exchanges, who'll put pressure on the top pools and it's game over.
Proof of Stake is even worse. You just have to go to the major stakeholders and threaten them with a $5 wrench.
It's going to wind down relatively slowly because unless you're smoking weed our criminal justice system is remarkably slow. I'm just glad it's going it before somebody got around to making Crypto Backed Securities and then reselling them as low risk assets ala the 2008 mortgage crisis.
Re: (Score:2)
Okay, what's the infrastructural cost to sustain Ethereum? Or Solana? Or Cardano? Or Chainlink?
Re: (Score:2)
Okay, what's the infrastructural cost to sustain Ethereum? Or Solana? Or Cardano? Or Chainlink?
Dead cows in Ireland ?
https://www.theguardian.com/en... [theguardian.com]
Re: (Score:3)
Maybe its time to go back to potatoes.
More than your bank's database (Score:1)
Re: (Score:2)
The fundamental market in the foreseeable future is dark markets and trade with sanctioned countries. This is already starting to show - certain untraceable coin popular in this sector outperforming by 20% everything else during the 2022 crash.
Market cap of shadow economies could only ever account for a very tiny fraction of world trade though.
Unlicensed securities exchange, bro (Score:5, Informative)
From https://www.sec.gov/news/press... [sec.gov] :
In one instance, the Binance chief compliance officer messaged a colleague that, âoe[w]e are operating as a fking unlicensed securities exchange in the USA bro.â
That's not going to go well for them.
Show me one major bank.. (Score:2)
Re: (Score:2)
Banks are doing the legal shady stuff. Crapcoin peddlers do _all_ shady stuff and outright criminal stuff as well. How anybody think much more criminal activity is better is beyond me.
SBF wants his ponzi scheme back (Score:2)
Changpeng can keep Caroline.
I'm shocked! (Score:2)
I'm shocked! Shocked to find that funds co-mingling is going on in here!