Despite facing a legal lawsuit from the United States Securities and Exchange Commission (SEC), cryptocurrency exchange Binance maintains its dominant position in the crypto ecosystem, holding an impressive 54% market share. The exchange remains the leading platform in the industry, demonstrating resilience amidst ongoing legal challenges.
Binance Sees $3B Outflow
Binance’s troubles with the U.S. SEC began on Monday when the agency alleged that the exchange offered securities to U.S.-based investors. The regulatory watchdog argues that cryptocurrencies are securities and should be registered with them before being offered to U.S.-based users.
The agency also accused Binance and its CEO Changpeng Zhao (CZ) of essentially controlling the affairs of the exchange’s U.S. subsidiary, Binance.US, despite claims that the U.S.-focused firm was independent. The U.S. SEC added to its claim that Binance was secretly moving billions of dollars worth of investors’ assets to a separate entity owned by CZ.
The allegations unsurprisingly triggered a massive sell-off from Binance. According to the blockchain analytics platform Nansen, Binance recorded an outflow of over $3 billion from multiple chains tied to its platform following the news of the lawsuit.
Despite the surge in outflows, Binance still retains over $54 billion worth of users’ funds, representing 54% of the market share for centralized exchanges, as revealed by the blockchain analytics firm, Kaiko.
U.S. SEC Expands Its Dragnet to Coinbase
According to yesterday’s reports, the U.S. financial agency sued the American crypto exchange Coinbase over similar allegations to those of Binance.
The U.S. SEC claimed that Coinbase violated securities laws by facilitating sales of crypto securities. The exchange’s crypto staking service was also termed a criminal offense. The financial agency alleged that the feature, which allows investors to earn rewards in crypto, constituted an illegal securities sale.
Nansen’s data reveals that Coinbase has since seen a negative outflow of $1.28 billion worth of users’ assets.
