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SEC is investigating Binance over its BNB token
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SEC is investigating Binance over its BNB token

SEC is investigating Binance over its BNB token

The agency wants to know if BNB was an unregistered token offering.

Amrita Khalid
A. Khalid
June 7th, 2022
SEC is investigating Binance over its BNB token | DeviceDaily.com
Dado Ruvic / reuters

The SEC has reportedly opened an investigation into Binance to find out whether its BNB token was an unregistered security during its 2017 initial coin offering, reported Bloomberg. BNB coins are primarily used to pay transaction fees on Binance, currently the word’s largest crypto exchange. The company is also facing another, separate SEC probe — launched in February — into alleged ties between its founder and two trading firms. The DOJ, IRS and CFTC also opened investigations last year into the company for a number of potential criminal violations, including insider trading and market manipulation.

“As the industry has grown at a rapid pace, we have been working very diligently to educate and assist law enforcement and regulators in the US and internationally, while also adhering to new guidelines. We will continue to meet all requirements set by regulators,” wrote a Binance spokesperson in an email to Engadget in response to a request for comment. Engadget has also reached out to the SEC for comment, and will update if we hear back. 

The SEC over the past few years expanded its crackdown of ICOs for failing to register with the agency before going public. The agency’s specific investigation into Binance also seeks to figure out if Binance.US — an affiliated exchange that launched in the US in 2019 after the latter was banned— is actually a separate entity from the China-based Binance.

Binance reportedly processed at least $2.35 billion in illegal transactions tied to drugs, hacks and fraudulent activity, according to a Reuters investigation published today. The story detailed a number of high-profile hacks of Binance, including a heist from North Korean hacking group Lazarus. Binance in a blog post responded to the Reuters story, writing that it was “rife with falsehoods” and published its email exchange with the news agency. In the exchange, Reuters reporters asked Binance to confirm multiple details from their reporting, including whether the company had taken any action to mitigate any further illegal activity. Based on the published emails, Binance seems to have declined to provide the requested details with Reuters on the record.

“We are sorry that Binance has declined our request for an interview. As we explained earlier, we cannot commit to keeping an entire briefing on background because it would not be ethical for us to withhold important information from an article,” wrote Reuters reporter Angus Berwick in an email to Binance spokesperson Patrick Hillmann.

The SEC has reportedly opened an investigation into Binance to find out whether its BNB token was an unregistered security during its 2017 initial coin offering, reportedBloomberg. BNB coins are primarily used to pay transaction fees on Binance, currently the word’s largest crypto exchange. The company is also facing another, separate SEC probe — launched in February — into alleged ties between its founder and two trading firms. The DOJ, IRS and CFTC also opened investigations last year into the company for a number of potential criminal violations, including insider trading and market manipulation.

“As the industry has grown at a rapid pace, we have been working very diligently to educate and assist law enforcement and regulators in the US and internationally, while also adhering to new guidelines. We will continue to meet all requirements set by regulators,” wrote a Binance spokesperson in an email to Engadget in response to a request for comment. Engadget has also reached out to the SEC for comment, and will update if we hear back. 

The SEC over the past few years expanded its crackdown of ICOs for failing to register with the agency before going public. The agency’s specific investigation into Binance also seeks to figure out if Binance.US — an affiliated exchange that launched in the US in 2019 after the latter was banned— is actually a separate entity from the China-based Binance.

Binance reportedly processed at least $ 2.35 billion in illegal transactions tied to drugs, hacks and fraudulent activity, according to a Reuters investigation published today. The story detailed a number of high-profile hacks of Binance, including a heist from North Korean hacking group Lazarus. Binance in a blog post responded to the Reuters story, writing that it was “rife with falsehoods” and published its email exchange with the news agency. In the exchange, Reuters reporters asked Binance to confirm multiple details from their reporting, including whether the company had taken any action to mitigate any further illegal activity. Based on the published emails, Binance seems to have declined to provide the requested details with Reuters on the record.

“We are sorry that Binance has declined our request for an interview. As we explained earlier, we cannot commit to keeping an entire briefing on background because it would not be ethical for us to withhold important information from an article,” wrote Reuters reporter Angus Berwick in an email to Binance spokesperson Patrick Hillmann.

Engadget is a web magazine with obsessive daily coverage of everything new in gadgets and consumer electronics

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