Crypto exchange Binance has refuted the US Securities and Exchange Commission’s (SEC) claim that its BNB token is a security, according to a statement shared by cryptoslate,
On June 5, the SEC labeled the BNB token as securities in its lawsuit against Binance, along with digital assets such as BUSD, ADA, ALGO, FIL, and others.
Binance denies the SEC’s claims.
in response to e-mail cryptoslateA Binance spokesperson said that BNB is a native token designed to create an internal economy, adding that its value is derived from its participants.
“BNB allows users who wish to engage with projects (such as gaming, social, financial, or other utilities) built on-chain to transact with BNB, thereby allowing BNB as a reflection of community-built projects.” creates user demand for. Coins do not represent an investment contract of any kind and are therefore not securities.”
Additionally, the crypto exchange made a mistake in the commission’s classification of BUSD as a security. According to the firm, BUSD is a fiat-backed stablecoin that has been described as “a non-security commodity” by the Commodities Futures Trading Commission (CFTC), another independent financial agency in the US, through court action.
Meanwhile, this is not the first time the SEC would describe a crypto project as a security. In April, the Algorand Foundation refuted the commission’s classification of its ALGO token as a security.
SEC Chairman Gary Gensler has said that all digital assets except bitcoin (BTC) are securities and highlighted the non-compliance of crypto firms.
SEC Action Wiped Over $4B From BNB Market Cap
News of the SEC lawsuit and its security classification of BNB wiped more than $4 billion from the asset’s market cap during the past 24 hours. cryptoslate Figures. The market capitalization of BNB declined from a peak of $46.93 billion to $42.54 billion.
It has since recovered to $43.35 billion as of press time.
Additionally, the exchange’s native token declined by over 10% to hit a low of $272.89
The crash of BNB reflects the performance of the broader crypto market during the past 24 hours. cryptoslate reported that the SEC’s action wiped $53 billion off the total crypto market cap.