Binance, the Binance CEO, and its former Chief Compliance Officer have been in the news recently as they were sued by the Commodity Futures Trading Commission- CFTC last month. The commission alleged that Binance enabled the trading of derivatives for U.S users without authorization to do so.
A commissioner at the CFTC Kristin N. Johnson, in an interview with CNBC said that conversations have been in progress between the regulator and Binance to address concerns relating to the company’s conduct. The conversation is aimed at having Binance explain what the regulator understands to be potentially problematic conduct.
The official mentioned that no decision has been taken on the legal case against Binance, and there is no immediate path forward. She added that not having a path forward “does not mean there couldn’t be one and hopefully there will be one.”
According to the commissioner, she wants to be careful not to prejudge what will happen in the litigation. In the context of litigation, “we are always ready to have conversations and typically even ahead of the litigation.”
Following the filing, Binance CEO Zhao stated in response to the CFTC claims that the exchange was transparent and compliant in the U.S. and beyond.
Lately, not just Binance but other crypto companies have faced tight scrutiny in the U.S. which is often traced to the result of FTX implosion and other crypto collapse in recent times.
Coinbase, a crypto exchange similar to Binance, filed a suit against the U.S. Securities and Exchange Commission to suggest that “the regulator should be forced to clarify whether it would allow the crypto industry to be regulated under existing securities laws.”
As the opinions on the lack of regulatory clarity become prevalent, Johnson said she is looking forward that the Congress introduce specific rules for crypto soon. Specifically, she said that “it is imperative that Congress step up and make plain what their preference is in terms of how to deal with the spot market oversight. And I think it’s helpful for us if Congress assist us and giving us that guidance.”
However, she said in the interview that the existing laws provide an understanding on how securities laws apply to digital assets that qualify as securities or commodities.
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