The US government is cracking down on crypto

US regulators filed a lawsuit yesterday against Binance, the world’s largest crypto exchange, for allegedly violating federal trading and derivatives laws. If successful, the Commodity Futures Trading Commission’s suit would impose a series of fines on Binance and permanently outlaw the exchange from serving any US customers.

🤔 What are the allegations?... The CFTC accused Binance of knowingly creating and maintaining a loophole from 2019 to the present through which US users could trade on its global platform. Over the same period, the company consistently claimed its global exchange wasn’t serving any Americans, and thus shouldn’t have to follow US regulations.

In a statement published yesterday, which didn’t mention the specific allegations, a Binance spokesperson cited the company’s efforts to operate legally in the US, including an American affiliate called Binance.US that offers a limited number of crypto products.

⚖️🪙 Zoom out: The CFTC’s lawsuit marks the latest clash between US regulators and companies or individuals involved in the crypto industry.

• The SEC last Wednesday notified Coinbase, the largest US crypto exchange, that it plans to sue the firm for allegedly violating a range of investor-protection laws.
• Also last Wednesday, the SEC also charged Tron founder Justin Sun and eight celebrities – including Jake Paul, Lindsey Lohan, Akon, and Lil’ Yachty – with illegally selling or promoting crypto tokens.

+Worth mentioning: Despite crypto’s recent legal woes, the price of bitcoin is up more than 63% so far this year. It recently eclipsed $28,000 for the first time since last June.