CEX Wars Episode II: The Gensler Strikes Back

Gary Gensler and the SEC have brought about lawsuits against two CEX’s who, to quote Gensler himself, have “engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.”

In unrelated news, SBF is still a free man.

Back to the main story. The legal proceedings brought against both Binance on Monday, and Coinbase earlier today, mark the clearest indication from the US securities regulator that the US government is determined to go to war with crypto – even if that means driving Web3 innovation offshore and into the open arms of other more Web3 welcoming nations.

Gensler vs CZ

In the first shot fired by the SEC, an announcement was made by the commission stating they were charging Binance with a variety of securities law violations. The quote featured in the graphic of the tweet, presumably to try and hammer home the severity of the situation, became a meme amongst Crypto Twitter shortly after publication.

After Gensler had doubled down on the announcement from his own account, Binance responded with a statement irrefutably pushing back against the charges, but also going on the attack themselves accusing the SEC’s true intent not of protecting investors, but rather to make headlines instead.

Gensler vs Armstrong

This has been another long standing feud which has indeed grabbed headlines in recent times. 

The SEC made an announcement on Tuesday morning that they were being charged with various violations such as “operating as an unregistered national securities exchange and broker” along with staking violations. This follows the very well documented story earlier this year of Brian Armstrong and Coinbase publicly stating that they have been seeking clarification for clear guidelines from the SEC for a number of years, with little feedback in the form of coherent responses to work with.

Gensler once again quoted the SEC official announcement to make his own commentary, stating that “Coinbase’s alleged failures deprive investors of critical protections, including rulebooks that prevent fraud and manipulation, proper disclosure, safeguards against conflicts of interest, and routine inspection by the SEC.”

In unrelated news, FTX is primed for a relaunch.

Back to the main story! Armstrong and Coinbase responded with their own rebuttal, accusing the SEC of taking a “regulation by enforcement approach that is harming America” and that they are proud to represent the industry in court to finally get some clarity around crypto rules.

SEC Files Restraining Order Against Binance

If you ask me, we should be filing restraining orders against Gensler, but regardless, in the most recent development which broke only hours ago, the SEC has filed for a restraining order to freeze Binance US assets. However, to be clear this would only affect customers of Binance.us if it is granted by the court. Users of Binance.com would not be affected, according to CZ.

Are You Feeling Protected?

Does this not all feel a little bit odd? Who, or what, is the SEC protecting with these moves? It certainly doesn’t feel like us, the users, does it. So what’s the real story here? Some have long thought that the vicious approach from US regulators towards crypto stems from their fear that they are losing their grip on the power they’ve held.

Unfortunately for the SEC, bringing charges against CZ and Armstrong – one’s which SBF should have been subject to long before he caused a considerable lack of protection for his customers – will not stop Bitcoin. Much the same, it won’t stop the assets they now deem securities either, for they will just pitch up elsewhere and continue.

It will put the brakes on prosperity for the American people, however; the people who the SEC was formed to protect. So again, who exactly is being protected here? It does make you wonder.

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