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The announcement of the United States Securities and Exchange Commission (SEC) suit against Binance, Binance.US and Binance CEO Changpeng Zhao (CZ) may have surprised the crypto community, but the SEC\u2019s focus on the exchange was well known. The suit\u2019s contents were met with a variety of reactions.<\/p>\n
CZ claimed<\/a> in a tweet on the morning of June 5, \u201cMedia gets the info before we do,\u201d and the company had not seen the SEC complaint then. Evidence of scrambling behind the scenes may be seen in the two statements Binance issued in response to the suit. <\/p>\n The exchange called the suit \u201cdisappointing\u201d in a blog post and emphasized the SEC\u2019s failure to provide clarity and guidance, as well as its impact on financial innovation. A later statement distributed by email addressed legal issues more closely, claiming there was a lack of due process and promising a vigorous defense.<\/p>\n No one who was paying attention should have been taken unawares by the SEC\u2019s complaint, Cory Klippsten, CEO of financial firm Swan Bitcoin, said of the allegations. He claimed in a statement to Cointelegraph:<\/p>\n \u201cThese practices of Binance have essentially been open secrets, so no one who operates in the space will be surprised by any of the charges.\u201d<\/p><\/blockquote>\n Some of the details will still raise eyebrows. The most quotable passage in the suit undoubtedly came from the unnamed Binance chief compliance officer in 2018, who said in a message to another company officer: <\/p>\n \u201cWe are operating as a fking unlicensed securities exchange in the USA bro.\u201d <\/p><\/blockquote>\n More light was shed on Brian Brooks\u2019 brief tenure as CEO of Binance.US. Brooks, former U.S. comptroller of the currency and CEO of Binance.US for three months in 2021, is memorably quoted in the suit (as \u201cCEO B\u201d of BAM Trading). According to the SEC, Brooks said in testimony: <\/p>\n \u201c[W]hat became clear to me at a certain point was CZ was the CEO of BAM Trading, not me. [\u2026] I realized, huh, I\u2019m not actually the one running this company, and the mission that I believe I signed up for isn\u2019t the mission. And as soon as I realized that, I left.\u201d <\/p><\/blockquote>\n The SEC has repeatedly claimed that nearly all cryptocurrencies are securities, so the list of 10 tokens may also be illuminating. There are familiar claims, such as that Filecoin (FIL) is a security. Algorand (ALGO) has also been singled out before. <\/p>\n For Solana (SOL), Cardano (ADA) and Polygon (MATIC), the Binance suit may be a warning shot, however. <\/p>\n And guess which tokens are illegal securities offerings. Spoiler alert it includes Solana and Cardano. pic.twitter.com\/wMdICfIE3j<\/a><\/p>\n\n