The crypto-verse was shocked late Monday by news of the Commodity Futures Trading Commission charging Binance, its CEO Changpeng Zhao (CZ) and the exchange’s former chief compliance officer, Samuel Lim, with ‘willful evasion of federal law and operating an illegal digital asset derivatives exchange.’
Binance Enticed US Persons to Trade on its Derivatives Platform
According to the CFTC, Binance offered and executed commodity trading transactions ‘to and for US persons from July 2019 through the present.’ The regulator added that CZ was fully aware of US persons trading on the exchange and even ‘instructed its employees and customers to circumvent compliance controls in order to maximize corporate profits.’
In addition, during the stated period, Biannce did not require their customers to undergo Know-your-Customer (KYC) procedures despite knowing they were required to do so by the CFTC. The exchange then purported to restrict US users from trading but still instructed its American VIP customers to evade its own compliance controls.
CFTC Chairman Rostin Behnam further explained:
For years, Binance knew they were violating CFTC rules, working actively to both keep the money flowing and avoid compliance. This should be a warning to anyone in the digital asset world that the CFTC will not tolerate willful avoidance of U.S. law. I applaud the diligent and dedicated work of the CFTC’s Enforcement team in bringing this action, and for their hard work in addressing illegal operations in the digital asset space.
BNB’s $300 Support Continues to Hold
News of the CFTC going after Binance, CZ, and its former compliance officer instantly affected the price of Binance Coin (BNB). Before the news, BNB was trading around the $330 price area only to drop by 7.3% to a local low of $305.9 due to the CFTC charges.
The one-day BNB/USDT chart below, courtesy of Tradingview.com, shows that BNB’s $300 support continues to offer a solid foundation amidst all the market chaos.
In addition, Binance Coin’s 50-day (white) moving average is currently acting as support around the $308 price area. The digital asset is also still trading above the crucial 100-day (yellow) and 200-day (green) moving averages.
However, its one-day MFI (green), MACD and RSI (red) hint of an ongoing pullback that could cause a dip below the $300 support to the 200-day moving average located at $290. Such a scenario seems likely as the month comes to a close this Friday.
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