The US Securities and Exchange Commission (SEC) is investigating cryptocurrency exchange Binance, which its CEO Changpeng Zhao questions.
Reports from the SEC state that Binance is under investigation over the legitimacy of its initial coin offering (ICO). Zhao recently confirmed that information, indicating that the US agency has been in contact with the exchange.
The executive said that the SEC regularly asks them questions about Binance and its products. He explained that they are always in regular contact with the authorities but have not summoned the exchange.
The Department of Justice (DoJ), the Commodity Futures Trading Commission (CFTC), and the Internal Revenue Service (IRS) are also scrutinizing Binance.
Curiously, the CEO of Binance said that he has a bank account but does not use it regularly.
The SEC Investigates Binance for Possible Violations of Securities Regulations
The Securities and Exchange Commission is reviewing the origins of Binance Coin (BNB) for alleged violations of securities regulations.
The investigators are inspecting whether the initial coin offering in 2017 amounted to the sale of a security not registered with the SEC.
Binance stated they consider it inappropriate to comment on their ongoing discussions with regulators. They mentioned that they have talked about education, assistance, and voluntary responses to requests for information.
They said they would continue to comply with the requirements established by the law.
The Exchange Says It Will Continue to Comply with Regulations
A Binance spokesperson stated they had worked diligently to educate and assist law enforcers and regulators. He said they have done it in the United States and abroad as the industry has rapidly grown.
He added that they would continue to comply with the requirements established by regulators while adhering to the new guidelines.
Changpeng Zhao Reflects on the Regulation of the Cryptocurrency Industry
Changpeng Zhao stated that it was necessary to distinguish between good regulation and over-regulation, as the latter would stifle innovation.
He said that it was crucial to classify cryptocurrencies to avoid placing them in a single bucket. He highlighted there are various types of crypto assets with different use cases.
The CEO of Binance also pointed out that governments should establish a new regulator for the industry. Even though he considers there should be regulation, he believes the industry can self-regulate in some areas.
Zhao thinks regulators should take a relaxed approach in some areas to see how the industry grows and develops.
Regulators are becoming increasingly interested in what happens within the cryptocurrency ecosystem. However, they should allow the industry to grow to become part of the world economy.
BNB is trading at around USD 222.29 and has accumulated a 0.5% loss over the last 24 hours. While its daily trading volume is above USD 2.12 billion, its market capitalization is about USD 36.26 billion. It occupies 5th place in the cryptocurrency ranking, according to CoinGecko.
By Alexander Salazar
