The post Binance’s Downfall: How the SEC’s Actions Spell Trouble appeared first on Coinpedia Fintech News
Over the past few weeks, the cryptocurrency market has seen a steady trend. After the FTX collapse caused a global meltdown late last year, crypto prices have been gradually recovering, indicating a recovery path to financial recovery. However, the largest cryptocurrency exchange Binance, might be in trouble, if a recent report by Bloomberg is to be believed.
There have been several causes of concern for Binance users due to the increased regulatory scrutiny by US regulators. According to the report, Binance has been continuously losing its dominance in the crypto market. In the past few weeks, its market share in spot trading has decreased, allowing other exchanges like OKX, Huobi, and Bybit to gain market share.
The US Securities and Exchange Commission (SEC) and the New York State Department of Financial Services (NYDFS) have taken action against Paxos, which led to the suspension of the minting of Binance USD (BUSD) stablecoin. In response, Binance has ended its zero-fee Bitcoin trading program and BUSD zero-maker fee promotion and has switched to low-market cap TrueUSD (TUSD) stablecoin.
A Binance spokesperson said, “Our primary objective right now is to mature our existing products and services and continue investing in our compliance processes to prepare for a new era of regulatory certainty.”
Kaiko, a market data provider, reported that Binance’s share of spot-trading volumes decreased from 73% in March to 51% in May. Meanwhile, the market shares of Huobi and OKX increased from 2% to 10% and 5% to 9%, respectively. South Korean exchanges also experienced a surge in market shares from under 8% to 14%.
US regulatory authorities have recently taken strict actions against major cryptocurrency exchanges, including Coinbase and Bittrex, as well as entities related to Binance. If the US Securities and Exchange Commission (SEC) takes enforcement action against Binance, it could have a massive impact on the exchange and the market.
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