Connect with us

get a dubai visa and apartment with bitcoin


BNB Under Scrutiny: SEC Investigates Token’s ICO



BNB Under Scrutiny: SEC Investigates Token's ICO
Join our Signal Channel

Buy Crypto with zero fees in Kenya, Nigeria and Uganda at zero fees

The United States Securities and Exchange Commission has set out to probe Binance to ascertain whether the crypto exchange violated securities rules during its BNB token initial coin offering in 2017. This further adds to the multiple investigations the popular centralized exchange faces in Washington. 

Binance Faces SEC Investigations over BNB Token ICO

In July 2017, Binance rolled out an initial coin offering (ICO) event that was staged on several platforms,  for its native token BNB. During the ICO event, half of BNB’s total supply was sold by the company to investors. 

Per an announcement by Bloomberg, the SEC is looking into the origin of Binance and BNB to find a possible investment violation case. This recent investigation by the US regulators is on the claim that the token’s (BNB) ICO should potentially have been registered with the agency. 

The probing further emanates from the assertion by SEC Chair Gary Gensler that “virtually all ICOs are securities and should be regulated by the agency.” Based on this premise, the agency has brought numerous cases over initial coin offerings. 

Crypto Discussion Group

More so, Bloomberg wrote that at least one US resident said he purchased BNB during the ICO. This could also be a strong point for the SEC on the aspect of jurisdiction, in any case it might bring forward.

Meanwhile, Binance holds that its native token BNB isn’t a security. This is further shown in CZ’s decision to rewrite BNB’s whitepaper in January 2019. 

According to the Binance CEO, the token’s whitepaper editing was done in response to legal advice that the previous wordings had the potential of presenting BNB as a ‘security’ in certain regions. 

Regardless, that wasn’t enough reason for the SEC to back off as the agency is still bent on scrutinizing BNB. Specifically, US regulators are verifying if the 2017 initial coin offering of BNB amounted to the sale of a security without registration with the agency. 

Should the findings reveal BNB to be a security then, Binance will fit into Ripple’s (XRP) current shoes. More so, the exchange could be fined or forced to change its mode of operation. 

Binance Faces Multiple Investigations 

Of late, Binance has been faced with multiple investigations in Washington. Other entities like the Justice Department, the U.S. Commodity Futures Trading Commission, and the Internal Revenue Service are equally probing Binance. 

Also, Reuters released a news article in May,  claiming that Binance processed funds amounting to about $2.35 billion from illegal sources between 2019 to 2021. In response, the exchange rebutted all of Reuters’ findings. 

Aside from the recent BNB case, the SEC is also investigating Binance for possible cases of insider trading. 

Onyeka is a multiple google ranked content writer. Loves to cover stories on Blockchain and Cryptocurrency and write in a way that is captivating and understandable.

Copyright © 2020 LightBlocks |