Fears Start Emerging Around BNB As US SEC Labels FTT As A Security
A lot of apprehensions are emerging in the cryptocurrency community regarding BNB (the native digital token of Binance) as the United States Securities and Exchange Commission (SEC) categorized FTT (the local token of the crypto exchange FTX) as security. In its latest filing submitted to the US District Court Southern District of New York, the SEC noted that the nature of the FTT token was that of security.
Binance Community Fears for BNB after SEC’s Declaration of Security for FTT
As per the agency, the token has a buy-and-burn project that is analogous to a stock buyback project. The regulator considers that objective of both programs is the same which is to increase the value of the asset. Binance crypto exchange also has such a project for BNB titled BNB Burn. The respective program was launched by it in the previous year.
As shared in a tweet posted by Cory Klippsten, Binance.US could even delist its BNB token while keeping in view that FTT has been labeled as a security by the securities agency. Dave Warburton, the person who suggested that the same treatment should be done by the crypto exchange with BNB as well as the rest of the tokens.
In the words of Warburton, the credibility of the SEC would be completely destabilized if the agency remained ineffective in declaring the token a security. The majority of the exchanges have sidestepped the listing of digital assets because the US securities agency might categorize them as securities. For instance, when a lawsuit was filed by the SEC against the crypto exchange Ripple in the case of its local token XRP, the token was instantly delisted by Coinbase.
In the case of BNB, the only prominent exchange supporting the token in the United States is Binance.US (the US-based subsidiary of Binance). Nonetheless, many of the community members argue that the token does not have the same characteristics as possessed by FTT. As per a Twitter thread published on the 23rd of December by B (a well-known sponsor of Floki Inu), the status of FTT is that of the local asset of the FTX crypto exchange.
However, B believes, BNB’s position is different from that as it is the native token of Binance and BNB Smart Chain. The BNB advocate proposes that the value of the token is associated with the most-used blockchain and crypto exchange across the globe. In the meantime, Changpeng Zhao (the CEO of Binance) also commented on the subject saying that a lot of people think that the exchange tokens are all the same.
While elaborating on the qualities of BNB Binance CEO mentioned that the token has a use case on the centralized exchange Binance while it is a local token on a couple of blockchains. In the previous twenty-four hours, BNB lost its value by 0.8 percent and is currently trading around $244.36. During the recent 7 days, the value of the Binance-supported digital token had elevated to more than seven percent.
BNB Struggles to Maintain Its Position amid Increased Scrutiny over Likely Money Laundering Charges
Nevertheless, the price thereof has dropped by up to seventeen percent in the previous thirty days because of the mounting pressure regarding the crypto exchange’s solvency. Zhao’s platform witnessed resilient outflows of approximately $6B as the consumers started extracting their funds on a large scale. A recently issued report additionally revealed that the US prosecutors were examining Binance over potential money laundering allegations.
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