Binance and SEC reach agreement; BUSD drops to fourth place among stablecoins; Institutions are actively accumulating Arbitrum (ARB)
The US Securities and Exchange Commission (SEC) took legal action against Binance and its CEO, Changpeng Zhao, in recent weeks. The crypto industry is in turmoil after the SEC filed a lawsuit against the stock market, alleging it violated securities laws.
Not only did it sue Zhao and the exchange, the regulator also filed a request to freeze the assets of Binance’s US arm, Binance US. Following the request, Binance US’s lawyers stepped in and made statements that such a decision could end all activities of the business abruptly.
Now, it is stated that the SEC and Binance have reached an agreement. The two soon struck a deal to ensure that only Binance US employees could access client funds.
According to the statements, the settlement between the US Securities and Exchange Commission (SEC) and Binance US will need to be approved by the federal judge overseeing the case.
Under the terms of the agreement passed between the SEC and Binance US, the US arm of the exchange is required to cut off any global Binance Holdings officials’ access to hardware wallets or private keys that provide direct access to Binance.US’ tools for Amazon Web Services.
In addition, under the agreement, the Binance US platform will be required to provide detailed information on operating expenses, including estimated costs, in the coming weeks.
As it is known, the securities regulator had requested an emergency in court to freeze the assets of Binance US, fearing that it could move its assets abroad and the evidence could be destroyed. On top of all these steps, Binance US took a step back and stated that such a decision could end all the activities of the platform.
Finally, according to the proposed deal, Binnace US will create new crypto wallets that will not be accessible to global exchange employees. In addition, the exchange will have to provide additional information to the SEC.
BUSD drops to fourth place among stablecoins
The market cap of BUSD fell 29% from $5.54 billion on May 18 to $4.30 billion. The stablecoin has been in a bearish trend since December last year, when its market cap exceeded $23 billion.
The decline in the market value of BUSD parallels Binance’s entry into the grip of the regulator. News that emerged last December that the US Department of Justice would target Binance led to a $3.6 billion BUSD liquidation within 7 days.
A partnership between Binance Paxos Trust paved the way for the BUSD stablecoin to emerge in September 2019. Paxos entered a difficult period with a Wells Notice from the SEC. The regulator claimed that BUSD is an unregistered security.
The investigation led to the New York Department of Financial Services (NYDFS) ordering Paxos to stop issuing BUSD. Thus, the market value of the asset decreased.
The final blow came when the SEC accused Binance of selling unregistered securities. The regulator filed 13 charges against the exchange.
Among stablecoins pegged to the US dollar, USDT still leads.
Circle’s USDC stablecoin and DAI stablecoin were also seen with similar declines.
USDC ranked second among the largest stablecoins by market cap, while DAI managed to move up to third place, surpassing BUSD.
Institutions are actively accumulating Arbitrum (ARB)
OffChain Labs has accumulated 7.22 million ARBs from Binance last week. On-chain analytics platform Lookonchain shared new data on Arbitrum (ARB) accumulation trends in a tweet earlier today. According to the post, the data shows that institutions are actively accumulating ARBs.
Lookonchain pointed out that software company Offchain Labs, in particular, purchased 7.22 million ARBs over multiple addresses over the past week. The accumulated ARB was worth more than $7 million and was purchased on Binance.
It can be interpreted that investors are turning to smaller-cap altcoins that are not labeled as securities in the SEC’s recent lawsuits, such as the ARB. Meanwhile, CoinMarketCap stated that ARB is one of the many cryptocurrencies that entered the new week with losses despite attracting the attention of institutional investors.
Meanwhile, ARB’s 24-hour trading volume has lost over 30 percent over the past day. At the time of this writing, it was around $128 million.