Binance Battling New Regulatory and Media Investigations Again

Binance Coin (BNB), the native token of the world's largest cryptocurrency exchange Binance, extended losses as fresh regulatory scrutiny and media scrutiny once again put the exchange in the spotlight -- albeit not in a positive way.

At 7:10 UTC on Tuesday morning, BNB changed hands at $282.7, down 9.1% over the past 24 hours. The token is down 12.2% over the past week and is down nearly 60% from its all-time high of $686 reached in May 2021, according to data from CoinGecko.

BNB 7-day price chartSource: coingecko.com

It’s worth noting that the entire cryptocurrency market is in the red today, even though BNB is one of the hardest-hit cryptocurrencies among the top 100 coins by market capitalization.

Meanwhile, the token’s losses extended following reports that U.S. regulators were investigating whether Binance violated securities rules by selling digital tokens during its 2017 initial coin offering (ICO).

The U.S. Securities and Exchange Commission (SEC) is investigating the origin of BNB tokens, currently the world's fifth-largest cryptocurrency with a market capitalization of more than $46.19 billion, Bloomberg reported, citing people familiar with the matter. Register with the agency.

The report also claims that Binance “faces multiple investigations in Washington,” adding that the SEC is investigating a market-making firm linked to CEO Changpeng Zhao (CZ).

“The SEC has expressed interest in Changpeng Zhao’s market-maker ownership on Binance.US and whether the exchange has engaged in broker-dealer activity,” Bloomberg reported, citing a person with direct knowledge of the review. .

In a statement, Binance reportedly said, “It would be inappropriate for us to comment on our ongoing conversations with regulators, which include education, assistance, and voluntary responses to requests for information.”

To make matters worse, a Reuters “special report” accused the crypto exchange of acting as a conduit for laundering at least $2.3 billion in illicit funds between 2017 and 2021.

Binance has been dealing with hacking, fraud and illegal drug sales for five years, the news agency said. Reuters said it worked with blockchain analytics firms Chainalysis and Crystal Blockchain to trace the funds, while also reviewing court records and statements from law enforcement.

In response to the report, Binance shared its email exchange with a Reuters reporter, saying it was "ridden with lies" and relied on poor data.

“We strongly advise you to ignore authors and authorities who cherry-pick data, rely on unverifiable ‘leaks’ provided by regulators, and fuel a cult of crypto paranoia for reputational or financial gain,” Binance said.

It’s worth noting that this isn’t the first time Binance and Reuters have gone head-to-head. In another “special report” in April, Reuters claimed that Binance’s Russian chief had agreed to share customer data with Russian authorities, which Binance immediately denied, calling the news investigation “absolutely fake.”