Two of the largest cryptocurrency exchanges, Binance and Coinbase, have been hit by lawsuits filed by the Securities and Exchange Commission (SEC) in a serious blow to the industry. The SEC has long argued that most cryptocurrency tokens are securities subject to its jurisdiction, despite pushback from some regulators and lawmakers. The charges filed against both Binance and Coinbase accuse them of operating as securities exchanges and selling digital assets that should have been registered. However, Binance and its CEO, Changpeng Zhao, were also charged with civil fraud, while no such allegations have been made against Coinbase or its CEO, Brian Armstrong. Both companies have been lobbying Congress for new legislation to clarify the rules surrounding digital assets, with Coinbase’s Chief Legal Officer, Paul Grewal, arguing that “the solution is legislation, not litigation.” Binance denies all the charges and is vowing to “defend our platform vigorously.”
