BNB dumps 10%, raising question: Attack or righteous justice?
On June 6, the crypto world was stunned by news of the state of affairs of one of the world’s largest crypto exchanges, Binance. First, Reuters published an investigation into the laundering of $2.35 billion worth of cryptocurrency through Binance from 2017 to 2021. The outlet used court records, law enforcement statements, and information of the blockchain itself in its investigation.
Binance officials responded that they do not believe the calculations were accurate and refused to provide their own data. Quotes of Binance Coin (BNB), the native token of the exchange and its BSC network, reacted with a slight drop of 4%.
Then, later that day, the United States Securities and Exchange Commission said it was opening an investigation into Binance. The investigation was opened to determine if the exchange had violated the securities law during the first sale of BNB in 2017. Following this news, BNB fell even lower, by 8.5%. The token is currently listed at $275, down $37 from yesterday.
Addressing the latest news, Binance called the comments about negotiations with the regulatory authorities inappropriate. The SEC itself declined to comment.
Binance’s chief, famed crypto entrepreneur Changpeng Zhao, reacted to the negative news with an eloquent tweet about BNB’s value, then rolled out correspondence between Binance’s cybersecurity team and reporters, which CZ said were handpicked, misleading and a waste of time.
Binance: Attack or righteous justice?
When mentioning the SEC, people who have been in the cryptocurrency space for a long time immediately think of the Ripple lawsuit, which is roughly similar to Binance’s situation and is still in progress. In that case, Ripple’s attorneys appealed to the bias against the company and that commission officials were in favor of its then main competitor, Ethereum.
It is entirely possible that a series of large-scale negative news in one day could also be a planned attack on Binance. Such thoughts are also suggested by the fact that just a week ago FTX CEO Sam Bankman-Fried transferred $1 billion to support the Democratic National Committee in the US election and then, quite Suddenly, Binance faced problems on all fronts.
Going back to the Ripple case and drawing analogies, one can expect with some certainty the further fall of BNB as well as more pressure on Binance from regulators and competitors.
