Binance Coin (BNB) is moving forward following the recent agreement between Binance and the CFTC.
On Monday, December 18, the U.S. District Court for the Northern District of Illinois officially approved the agreement between cryptocurrency exchange Binance and the U.S. Commodity Futures Trading Commission (CFTC).
Under the terms of the settlement, Binance will pay $2.7 billion to the CFTC. Former Binance CEO Changpeng Zhao (CZ) will pay $150 million to Binance.
BNB rises by 7%!
Binance has been ordered to make certain changes to its internal operations and oversight to improve transparency and prevent future legal challenges. Exchanges must implement a structured internal governance system.
In particular, a board of directors should be established, a governing body comprised of members not directly involved in managing Binance’s day-to-day operations.
The goal is to ensure objectivity and help ensure decisions are in the best interest of the company and its users. A Compliance Committee and Audit Committee will be added to ensure Binance’s compliance and accountability.
The CFTC previously launched an investigation into Binance, claiming that the exchange violated anti-money laundering and sanctions laws. On November 21, Binance and CZ reportedly signed a plea agreement with U.S. officials, including the CFTC and the Department of Justice (DOJ).
In a statement following the guilty plea deal, CZ acknowledged that Binance failed to comply with relevant regulations, but emphasized that the company did not misuse customers’ funds. Binance Coin (BNB) reacted negatively to news of the agreement. Immediately after the agreement was announced, the coin fell from $267 to $226.
As the situation calms down, BNB price reflects optimism. In the last 24 hours, BNB rose by up to 7.20%, from approximately $236 to $252. The surge capped a dismal month for the cryptocurrency and appeared to catch up with the recent gains in the overall market.
Bitcoin recovered to the $43,000 level this morning after a bloody weekend. Apart from BNB, other altcoins such as Injective (up 26.38%) and Sei (up a staggering 50%) have witnessed impressive rallies.
SEC Isn’t Over Yet
There has been ongoing discussion surrounding market trading volume led by Binance. As news of the agreement became known, some experts suggested that other exchanges may take Binance’s place. The warning came true, but it did not last long.
Kaiko’s data analysis shows that the exchange’s daily trading volume has decreased by 60%, from around $20-30 billion to $10 billion. However, it has seen a resurgence, with trading volume exceeding $13 billion, according to the latest data from CoinMarketCap.
Compared to Binance, Coinbase’s trading volume in the last 24 hours was over $2 billion, followed by Kraken, KuCoin, Bybit, and OKX. This means that Binance’s reputation remains intact despite ongoing regulatory issues.
While the recent settlement with U.S. officials and Binance’s focus on compliance are positive developments, the final outcome of the SEC lawsuit and the broader regulatory environment for cryptocurrency exchanges in the U.S. remain uncertain.
Binance is still pursuing legal action against the securities firm. In 2023, the SEC filed a lawsuit against Binance for allegedly offering unregistered securities, including BNB tokens, lending products, and staking services. More information will come from Binance and global regulators.
Regulators have since targeted other exchanges such as Coinbase and Kraken with similar concerns, highlighting a broader crackdown on potential securities violations within the cryptocurrency industry. In a recent public statement, Coinbase’s Chief Legal Officer Paul Grewal expressed the company’s growing frustration with the lack of progress in cryptocurrency regulation.
As a next step, Coinbase plans to appeal to the Third Circuit Court of Appeals, seeking court intervention to force the SEC to finally address its urgent need for clear cryptocurrency regulation.