US SEC vs Binance and Coinbase: Crypto Community Reacts

Editing by Nathaniel Cajuday

• ETC Group’s Bradley Duke believes that the SEC’s actions against Binance and Coinbase signal that the U.S. lacks a regulatory framework for cryptocurrencies, making it unwelcoming to crypto businesses.
• ARK36’s Mikkel Morch sees the U.S. SEC’s lawsuits against Coinbase and Binance as intensifying the regulatory crackdown on the crypto industry, potentially setting a precedent for other exchanges.
• Atty. Rafael Padilla suggests that the US SEC’s decision may influence regulators in other jurisdictions, including the Philippines SEC, and that the outcome of the cases could impact the regulatory landscape globally.

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Following the news about the Securities and Exchange Commission of the United States (U.S. SEC) filing a lawsuit against cryptocurrency exchange giants Binance and Coinbase, international and local web3 personalities shared their opinions on the matter.

Comment on the Binance and Coinbase Probe

Crypto ETP provider ETC Group and crypto hedge fund ARK36 both shared their comments on the ongoing probes. 

For ETC Group’s Bradley Duke, the U.S. SEC’s actions against both Binance and Coinbase indicate that the US is unwelcoming to crypto businesses due to the lack of a regulatory framework.

“By first going after Binance and then Coinbase in rapid succession, the SEC is sending a clear message to businesses operating in crypto, both foreign and homegrown, ‘You are not welcome in the US,’” Duke explained. “There is no regulatory framework for crypto in the US so companies operating in this sector are completely in the dark as to how to be compliant and good corporate citizens. In contrast, Europe’s recently ratified MiCA framework offers up clear rules and guidance to crypto firms, giving comfort to services providers and investors alike – a far more welcoming environment.” 

On the other hand, Mikkel Morch from ARK36 highlighted that the SEC’s lawsuit against Coinbase adds complexity to the regulatory landscape for cryptocurrency platforms, noting that another charge, this time to Coinbase, coming just a day after the action against Binance, “it is evident that the regulatory crackdown on the crypto industry is intensifying.”

“This case could set a precedent for how other exchanges are regulated and may prompt similar actions from regulators worldwide. Coinbase and Binance’s ability to navigate this legal battle will have significant implications for the broader cryptocurrency industry. As two of the most prominent and well-established exchanges, Coinbase and Binance have the resources to contest the SEC’s charges. Their defense strategies and the legal outcomes will influence the regulatory approach towards other exchanges and shape the future of the industry,” he added.

Local Opinions: How Will This Affect The Regulatory Space In The Philippines?

In a live stream interview on YouTube, Paul A. or Coach Miranda Miner, a crypto-related vlogger and CEO of web3 learning platform FEASTGold, had a discussion with Atty. Rafael Padilla, the co-founder and trustee of BlockDevs Asia, professor of Law at San Beda Alabang, and a BitPinas contributor, regarding the recent moves of the US SEC against two of the biggest exchanges. 

When asked what would happen if the SEC were to win the case against the exchanges, Padilla noted that even if it were a U.S.-based case, the impact would also be felt throughout the country. 

“The US regulators are influential, so we can expect some of their peers in other jurisdictions, including the Philippines SEC, to follow,” he stated.

Padilla also shared that the PH SEC relies on the U.S. SEC’s decision on securities following their filed complaint regarding a local exchange listing Ripple XRP—the U.S. SEC charged Ripple for offering unregistered securities in 2020—where the local Commission stated that they are still waiting for the U.S. SEC’s decision on the matter. 

U.S. SEC vs. Binance and Coinbase

On June 5, 2023, Binance and its CEO Changpeng Zhao were charged by the U.S. SEC for violating securities laws. The charges accused Zhao of offering and selling digital asset securities to U.S. residents without proper registration with the U.S. SEC. 

Additionally, the U.S. regulatory commission alleged that Binance operated as an unregistered securities exchange and failed to provide the necessary disclosures to investors. 

Following this, 12 coins and tokens were identified by the SEC as securities; the cryptocurrencies and tokens are Solanam Cardano, Filecoin, Cosmos, Algorand, Binance Coin, Binance USD, Polygon, The Sandbox, Decentraland, Axie Infinity Shards, and COTI.

A day after the Binance lawsuit, the U.S. SEC then went after Coinbase to sue the company for violations of securities laws for operating as an unregistered securities exchange, broker, and clearing agency. 

This article is published on BitPinas: RIPPLE EFFECT? Web3 Personalities React to US SEC vs Binance, Coinbase Battle; PH Lawyer Says Case Could Influence Local Regulators

Disclaimer: BitPinas articles and its external content are not financial advice. The team serves to deliver independent, unbiased news to provide information for Philippine-crypto and beyond.