The US Commodity Futures Trading Commission (CFTC) has filed a lawsuit against Binance and its CEO Changpeng Zhao, who the commission believes is responsible for Binance's violations based on his prolonged failure to act in good faith with regards to Binance's illicit activities.
The essence of the allegations is that Binance has purportedly been offering trading in commodity derivatives to US residents since 2019 in violation of the law. Following this news, the entire crypto economy lost 2.94% against the US dollar, with Bitcoin (BTC) dropping below $27,000.
"CFTC will continue to use all of its authority to identify and stop unlawful conduct on the volatile and risky digital asset market," said CFTC Chairman Behnam.
"For years, Binance knew that it was operating illegally and actively worked to both maintain and evade its obligations," the Chairman concluded. "This should serve as a warning to all digital asset market participants that the CFTC will not tolerate intentional evasion of U.S. law."
In addition to these allegations, there are many other questions surrounding the leading cryptocurrency exchange, including possible insider trading involving two accounts belonging to CZ.
