Host of CNBC’s Mad Money Jim Cramer has taken to his Twitter handle to comment on the ongoing case filed against Binance by the US Securities and Exchange Commission (SEC).
Cramer in a tweet on Tuesday 6 June said the report by the SEC reveals the weaknesses in the crypto space, referring to it as a “sham”
“Today those who toil daily to prop up crypto coins will have to work in overdrive. The Binance brief by the SEC is so devastating that the defenders of this company will have to do some serious soul-searching. and expend real capital to maintain what looks to be a sham”
Known for his controversial position on cryptocurrencies, Cramer is an ex crypto enthusiast who has now become a renown critic of the space. He is also known for his predictions of crypto trends which usually turn out to be inaccurate.
The Battle for Binance’s Soul
While Binance faces the legal challenge of defending its operations, it seems like a dream come true for men like Cramer who wish to prove that cryptocurrencies and everything associated with it is a fraud.
The crypto market which was in a downward trend before the declaration of the case against Binance has suffered a worse fate as a result. Investors have withdrawn millions worth of assets from the exchange in a knee-jerk reaction to the news, which could potentially push the market further down.
It isn’t only Binance but the whole crypto industry in the US that is targeted in what seems to be a coordinated crackdown on the industry. Coinbase, a crypto giant in the country, also has a court case against the SEC, which claims to have all crypto exchanges under its jurisdiction.
This has escalated to other countries, making banks to restrict payment to centralized exchanges such as Binance and Coinbase. In Australia, banks are refusing to process transactions they confirm to be meant for the purchase of cryptocurrencies in a bid to protect their customers from the risks of crypto investing.
In the UK, the Financial Conduct Authority (FCA) has mad it mandatory for crypto adverts to carry warnings about the risks of investing in crypto, and to also leave a “cooling period” for new crypto investors. All this came after the suit against Binance and Coinbase.
Lack of Clear Regulation Causing Issues
The US has not been able to come up with any clear direction for crypto companies to follow, hence the confusion around the requirements set by regulators. So far, the SEC claims that there’s sufficient guidance, but Coinbase has challenged this position in court.
However, the SEC is still going after crypto companies even though it has no clear regulations. The outcome of these cases will determine if the agency is right or not.
