Binance is accused of allowing US residents to trade despite the fact that the platform is not registered as a securities exchange in the US.
In a drastic turn of events, BNB Coin the native token of Binance experienced a 10% sudden drop after Binance.com and Binance US faced a legal allegation from US SEC.
US officials charged cryptocurrency company Binance on Monday with securities law violations totaling "an extensive web of deception" and "calculated evasion of the law."
Binance is accused of allowing US residents to trade despite the fact that the platform is not registered as a securities exchange in the US. Binance is also accused of misusing user funds, according to the complaint.
The Securities and Exchange Commission issued a civil complaint outlining 13 claims against founder Changpeng Zhao, who was previously considered the archrival of disgraced crypto billionaire Sam Bankman-Fried.
The SEC investigation follows charges brought by another US body, the Commodities Futures Trading Commission, in March.
According to the SEC, Zhao and Binance publicly claimed that US consumers were forbidden from transacting on Binance.com, but the platform "secretly" permitted high-value customers to continue trading.
Zhao maintained that Binance.US was independent of Binance but was "secretly controlled" by Binance "behind the scenes," according to the complaint.
The SEC also claimed that Zhao and Binance "commingled" client assets, including those belonging to another Zhao-controlled firm, Signa Chain, which "engaged in manipulative trading that artificially inflated the platform's trading volume," according to the SEC.
Zhao also stated that the Binance "team is all standing by, ensuring systems are stable, including withdrawals, and deposits."
"We will issue a response once we see the complaint. Haven't seen it yet. Media gets the info before we do."
Meanwhile, BNB Coin faced a massive sell-off leading to a 10% drop in a single day. Let's see how BNB will perform in the next few days.
At the press time, BNB (BNB) price is $276.28, with a 24-hour trading volume of $1,596,946,084. This indicates a -8.40% drop in the last 24 hours and a -11.69% drop in the previous 7 days. With a circulating supply of 160 million BNB, BNB has a market capitalization of $43,597,391,699.
During the recent downturn, the BNB price fell to $276.6, a 21% decrease in the last two months. However, looking at a larger time frame chart, the coin price formed a symmetrical triangular pattern.
This pattern on the weekly chart shows that the ongoing correction is still in place and that the overall sideways trend is unaffected. Because of this pattern and the present bearish feeling, the Binance coin price may fall 8% and test the $252-$250 support level.
The 14-day RSI slope falls deeper into bearish territory, indicating that supply pressure is strong and that sellers may accelerate a drop to $250.
Furthermore, the aforementioned support coincided with the triangle pattern's bottom trendline, preventing the BNB price from falling too far. Until this pattern is broken, coin holders can maintain a bullish attitude and anticipate a quick rebound.
In conclusion, the BNB coin is experiencing a bearish down momentum due to the recent allegations by US SEC. The technical indicators are all pointing towards a heavy bear move. Overall, the BNB coin sentiment is negative.