Just days after the U.S. Securities and Exchange Commission (SEC) sued crypto exchanges Binance and Coinbase for selling unregistered securities, crypto companies are already dealing with the fallout.
Binance, which was sued by the SEC on Monday, announced(opens in a new tab) on Thursday evening that the crypto exchange would be “suspending” U.S. dollar deposits. U.S. dollar withdrawals will also be suspended “as early as” June 13.
“We encourage customers to take appropriate action with their USD,” Binance said in its statement. Basically, if you have U.S. dollars sitting in your Binance account, move your money elsewhere ASAP because your assets are frozen.
Binance blamed the SEC for “creating challenges for the banks” that Binance partners with, leading to these banking partners “pausing fiat withdrawal channels.” While the SEC sued both Binance and Coinbase this week for selling unregistered securities, the regulatory agency also went further with Binance, alleging the crypto exchange partook in “market manipulation and fraud.”
After Binance’s announcement, the dominos continued to fall.
The popular stock trading app Robinhood announced(opens in a new tab) on Friday that the company would be delisting all of the cryptocurrency tokens that trade on its platform that the SEC classified as unregistered securities. According to Robinhood, it will end support for the crypto tokens Cardano (ADA), Polygon (MATIC), and Solana (SOL) after June 27.
Users can buy and sell these tokens until then, and can transfer these tokens to other crypto wallets as well. However, after that date, any account holding Cardano, Polygon, or Solana in their Robinhood account will automatically sell the tokens and be credited with the funds.
Also on Friday, the crypto exchange Crypto.com(opens in a new tab) announced that it would be shutting down one of its services: its institutional exchange. In a statement provided to the cryptocurrency media outlet Blockworks, Crypto.com claimed(opens in a new tab) that the decision was made due to “lack of demand due to the market landscape in the U.S.”
For now, Crypto.com(opens in a new tab) is not planning any changes to its retail exchange and will continue operating in the U.S. The company’s now-shuttered institutional exchange provided services for institutional investors like pension funds, mutual funds, and university endowments – all institutions that have likely been turned off by crypto due to the rampant decline in the market over the past 12 months.
