The recent legal actions taken by the U.S. Securities and Exchange Commission (SEC) against major cryptocurrency exchanges Binance and Coinbase have had a significant impact on the crypto market.
The SEC’s lawsuits against Binance and Coinbase triggered a sell-off in the crypto market, affecting the value of various digital assets.
Binance’s SAFU, designed to protect user assets in the event of security breaches, experienced a decline of 10% in its value, dropping from nearly $950 million to approximately $861 million.
The majority of assets held in SAFU are Bitcoin (BTC) and Binance’s native token, BNB, which have experienced declines of approximately 6% and 20%, respectively, following the SEC’s charges.
The SEC accused Binance of several violations, including failing to register as a securities exchange, serving U.S. customers unlawfully, and mixing customer funds from different platforms. Binance has denied these allegations and assured the safety of all funds.
Binance’s emergency fund undergoes regular reviews and is replenished with additional capital when necessary. In the past, Binance has increased the fund from $735 million to $1 billion following a market downturn.
Some Binance users have expressed concerns that Binance might manipulate the value of its BNB token, considering a change in the terms of use that allows the exchange to alter the assets held in users’ accounts.
Binance CEO Changpeng Zhao (CZ) addressed rumors of the exchange selling BTC or BNB, confirming that no such selling had taken place and dismissing the notion that detailed trading charts could reveal such activities accurately.
