SEC Sues Binance and Coinbase, El Salvador Mines, & Bitcoin Life Insurance - Week 40

Jun 07, 2023

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News

SEC Sues Binance

According to an NPR report, a complaint filed by the U.S. Securities and Exchange Commission (SEC) alleges that Binance, one of the largest cryptocurrency exchanges, knowingly violated U.S. laws.

The complaint includes a quote from Binance's chief compliance officer admitting the operation of an unlicensed securities exchange in the United States. Binance responded by stating that it takes the SEC's allegations seriously but believes they are unjustified, asserting that the company has become a target in the midst of a regulatory conflict in the United States.

In response to the regulatory scrutiny, Binance has made a significant leadership change by appointing Brian Teng as the new CEO replacing CZ. This decision comes as Binance aims to address its regulatory challenges and reinforce its leadership team.

Further, the SEC proceeded to troll Binance with a Quote from the COO from an internal email exchange.

SEC Looks to Freeze Binance Customer Funds

According to No BS Bitcoin within the court filings, the U.S. Securities and Exchange Commission (SEC) has taken steps to freeze funds held by Binance in the United States. The SEC's action is part of its ongoing investigation into potential securities law violations by the cryptocurrency exchange. The freeze is intended to preserve the funds in question while the investigation unfolds.

SEC Sues Conbaise

One day after the lawsuit against Binance, Coinbase was also targeted by the SEC.

The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Coinbase, alleging the exchange's failure to register its proposed yield-generating product as a security. The SEC argues that the product falls under the definition of security and should have been registered accordingly. Within the lawsuit filing, the SEC directly names cryptocurrencies under unregistered securities.

"We don't need digital currency, we already have that, the dollar." -

@GaryGensler

US Senator Cynthia Lummis responded to the SEC suing Coinbase. This comes after the SEC approved Coinbase as a publicly traded company in 2021.

El Salvador Raises $1B and 241 MW Mining Farm

According to Coindesk, Volcano Energy, a subsidiary of El Salvador's Bitcoin mining company, has secured $1 billion in commitments to fund a 241 MW Bitcoin mining facility.

The funding will establish a volcano energy-powered mining operation, emphasizing El Salvador's commitment to sustainable Bitcoin mining practices. The project is expected to contribute to the country's job creation and economic development while promoting environmentally friendly mining solutions.

Bitcoin Life Insurance Company Raises 19 Million

In a recent funding round, a life insurance company focused on Bitcoin successfully raised $19 million at a valuation of $100 million. The company has garnered support from notable investors such as Sam Altman and Google's venture capital fund.

“The team has an opportunity to change how consumers use digital money and set a new standard for tech-enabled life insurance providers.” - Anna Patterson, managing partner at Gradient Ventures

“Using A.I. to issue claims and evaluate the health risks of applicants, the firm, which has seven employees, only deals in Bitcoin. Customers pay monthly premiums in crypto, and claims are paid out in crypto. To make money, meanwhile, like many other life insurance providers, the company lends out a portion of what's collected in monthly premiums and charges interest on the loans.” - Fortune

Price

Following the huge allegations against two large exchanges, Bitcoin’s price has mostly stayed the same. This is partly because Bitcoin is called a commodity by regulators and is not under the scope of the SEC.