Binance and CZ sued by the SEC

In the latest episode of The Market Report, analyst and author Marcel Pechmann discusses the implications of the SEC’s lawsuit against the Binance exchange.

Most likely, the US population will be barred from using the international version of Binance, and those who opt for VPN services will be at risk of prosecution. Pechman believes that Changpeng “CZ” Zhao and Binance will lose a deal by pleading guilty or be struck off, pay a fine, and be forced to stop services for North American entities – including Paxos and Binance USD. (BUSD) stablecoin.

Considering Binance is the absolute leader in spot and derivatives trading, a 5% price correction on April 5th can be called a “vote of confidence”, meaning traders believe that Binance International will remain fully operational. worst case scenario? Heavy fines, but operations will not be affected, and every customer will be made whole, similar to the result for BitMEX.

As far as the 10 tokens claimed to be SEC securities go, North Americans will not be blocked from buying or holding those altcoins, but it does add an extra step if they are willing to trade them – eg. For, using a decentralized exchange.

Pechman believes Coinbase’s lawsuit is different from Binance’s because the US-listed company has a large base of North American customers and cannot move its operations overseas without a significant reduction in its user base and volume. Can do. In addition, Binance is also involved in other issues, such as the transfer of funds between related entities and the possible illegal use of client funds.

Therefore, the first read for Coinbase shows a very light case, unlikely to become anything more eventful, while the odds are high for Binance and CZ to face Department of Justice and criminal charges.

Pechman stressed that if the US Federal Reserve continues printing trillions of dollars to prop up the economy, investors will scramble to find scarce assets, so there will be a crypto bull run regardless of whether Coinbase and Binance are participating in the process. Or not.

Finally, the show discusses whether the bitcoin price will retest the $24,000 level, noting that the long/short ratio has hit levels not seen in over 12 months. The show airs every Tuesday on the Cointelegraph Markets & Research YouTube channel.