US Regulators Investigating Binance’s BNB Token: Report

The U.S. Securities and Exchange Commission (SEC) is examining whether Binance’s initial coin offering of its Binance Coin (BNB) token in 2017 was an unregistered security offering which should have been registered with the regulatory agency, Bloomberg reported Monday, citing confidential sources.

• In a statement to Bloomberg, Binance said it would be inappropriate for the company to comment on its ongoing conversations with regulators and that it would “continue to meet all requirements set by regulators.”
• BNB was trading down 4% after news of the report came out.
• Binance is currently under investigation in the U.S. by the Justice Department, the Commodity Futures Trading Commission (CFTC) and the Internal Revenue Service. Binance is the world’s biggest crypto exchange and says it’s not domiciled in any one country.
• The SEC is also investigating market-making companies owned or partially owned by Binance CEO Changpeng “CZ” Zhao that do business with Binance.US, a U.S.-based affiliate of the global exchange, according to a source familiar with the review, Bloomberg reported.
• According to the report, one of the SEC’s focuses is on whether Binance.US is wholly independent of the global exchange, and whether employees may be involved in insider trading.
• Spokespeople for Binance did not immediately return requests for comment. An SEC spokesperson declined to comment on the existence of any possible probe.