US SEC Targets Major Crypto Platforms in a Coordinated Effort to Control the Flow of Capital
In a significant move, the United States Securities and Exchange Commission (SEC) has filed lawsuits against two major cryptocurrency platforms, Coinbase and Binance. The SEC’s actions have resulted in the classification of at least 61 cryptocurrencies as securities, impacting a market value of $100 billion. The charges against both platforms raise concerns over unregistered broker activities, lack of investor disclosures and protections, and the categorization of certain crypto assets as securities.
The SEC’s lawsuit against Coinbase revolves around four key complaints. Firstly, Coinbase is accused of operating as an unregistered broker since 2019. Secondly, the platform is alleged to have deprived investors of necessary disclosures and protections that registered brokers provide. Thirdly, the SEC claims that certain crypto assets available on Coinbase fall under the purview of securities. Lastly, the SEC considers Coinbase’s staking program as an investment contract, qualifying it as a security.
Similarly, Binance is facing similar charges by the SEC, with the addition of allegations related to co-mingling funds and misusing customer funds. As a result, Binance may have to prove its compliance with the law within 28 days or face a cease and desist order in ten states: Alabama, California, Illinois, Kentucky, Maryland, Vermont, New Jersey, South Carolina, Washington, and Wisconsin. The potential loss of trading fees in these states could significantly impact Coinbase’s profitability.
These recent actions by the SEC raise questions about the underlying motivations behind the lawsuits. It is suggested that the US government, in collaboration with Wall Street, aims to maintain control over the flow of capital by targeting major cryptocurrency exchanges. By restricting the on and off ramps for converting US dollars to crypto and vice versa, the government seeks to safeguard its control over the financial system. However, critics argue that such actions stifle innovation and limit individuals’ financial freedom.
Moreover, this coordinated effort to control the crypto industry extends beyond individual projects and now targets leading platforms like Coinbase and Binance. Some speculate that Wall Street firms, in alliance with the government, may seek to acquire these platforms rather than outright ban them. This consolidation of power would grant traditional finance institutions the reputation, industry expertise, and regulatory approval necessary to attract more crypto business.
Additionally, the US government’s actions align with a broader trend of centralizing and consolidating the financial system. The Federal Reserve’s plan to increase interest rates, leading to the demise of smaller banks and subsequent mergers, exemplifies this approach. The ultimate goal appears to be the creation of a centralized financial system dominated by a select few large banks, including JP Morgan, alongside the Federal Reserve.
This push for control over money and capital flow comes at a time when cryptocurrencies, such as Bitcoin, are increasingly viewed as alternatives to sinking fiat currencies. People and countries worldwide are seeking ways to generate and maintain wealth outside the traditional financial system. Consequently, the government’s actions are seen as attempts to maintain control over the economy and prevent the mass adoption of decentralized cryptocurrencies.
In conclusion, the recent charges brought by the SEC against Coinbase and Binance mark a significant development in the regulation of the crypto industry. The coordinated effort by the government and Wall Street aims to control the flow of capital by limiting the on and off ramps for converting fiat currency to crypto. These actions not only impact major platforms but also threaten individual financial freedom and the growth of decentralized finance. It is crucial for crypto investors to prioritize self-custody and explore alternative tools to safeguard their funds in the face of increasing regulatory scrutiny.
