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Binance US Suffers Major Setback as Trading Activity Plummets by 98% Amid SEC Dispute

Sep 19, 2023 #Binance US

Binance US Finds Itself Dealing with a Series of Challenges, Leading to a Significant 98% Drop in Trading Activity. These unforeseen obstacles collectively cast a shadow over the once-active trading landscape of the platform, sparking concerns about its continued viability in the market.

According to statistics from the independent research firm CCData, the monthly trading volume of Binance’s US counterpart, Binance.US, plummeted by 98% from January 2022 to August 2022, with further declines expected in September.

Data from Amberdata indicates that over the weekend, Binance.US’s trading volume dropped to $5.09 million. In contrast, on September 17, 2022, the exchange’s trading volume was approximately $230 million.

Most of the decline occurred after March, coinciding with the Commodity Futures Trading Commission (CFTC) bringing regulatory misconduct charges against Binance’s CEO, Changpeng Zhao.

In June, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Binance.US, Changpeng Zhao, and their major exchange Binance, alleging a series of violations, including allegations of misrepresenting control and supervision of trading on the Binance.US platform.

The Miami-based company is currently embroiled in a legal battle, leading the SEC to assert inconsistencies in Binance.US’s maintenance of a consistent narrative in documents submitted on Monday.

Following the lawsuit, Binance.US suspended trading for over 100 token pairs, resulting in a significant drop in exchange activity and investor confidence.

Additionally, the company is facing internal challenges, with key executives, including CEO Brian Shorder and legal counsel Krishna Juvvadi and Chief Risk Officer Sidney Majalya, resigning, with the latter departing within weeks of Shorder’s exit.

The SEC in the United States has expressed concern over a significant exodus of personnel from Binance.US, emphasizing the need for a swift investigation into these issues.

Judge Denies SEC Access to Binance.US Information

Meanwhile, the U.S. SEC faced a setback as a federal magistrate judge blocked their immediate access to Binance.US’s software. Since the regulatory agency filed charges against Binance.US, Binance Holdings, and Changpeng Zhao in June, the SEC has struggled to obtain information from Binance.US.

On Monday, the U.S. SEC requested that a federal magistrate judge grant them access to view the technical infrastructure of Binance.US and compel the company to share other information.

Due to the magistrate judge’s refusal to grant immediate access, the SEC’s cryptocurrency case faced a minor procedural obstacle. The SEC reported that Binance.US provided fewer than 250 documents and three witnesses.

As of Monday, CoinGecko data shows that Binance.US’s daily trading volume is approximately $10.5 million. In stark contrast, the largest cryptocurrency exchange in the United States, Coinbase, has a daily trading volume of $948 million.