Ben Todar, notable crypto commenter, successful entrepreneur and CEO of a blockchain-based gaming ecosystem, said the lawsuit against Binance, the largest crypto exchange in the world, sparks concerns that the US Securities and Exchange Commission (SEC) is trying to protect traditional financial institutions by crushing the U.S. crypto industry.
"The #SEC's attack on #Binance not only undermines the freedom and innovation of cryptocurrencies but also raises concerns about its role as a tool wielded by traditional banks to suppress the growth of digital currencies," Todar wrote in a June 5 Twitter post. "By targeting Binance, the SEC appears to align with the interests of established financial institutions that perceive cryptocurrencies as a threat to their dominance. It is essential to recognize the potential influence and lobbying power that traditional financial entities exert over regulatory bodies, which can shape their actions against the crypto industry. As advocates for crypto freedom, we must remain vigilant and push for fair and unbiased regulation that allows the transformative potential of cryptocurrencies to flourish, unhindered by the agendas of traditional financial gatekeepers."
The SEC filed complaints this week against two major cryptocurrency exchanges, and SEC Chair Gary Gensler, who is facing criticism for the Commission's approach to regulating crypto, said on Tuesday that he does not see a need for "more" digital currencies. Gensler said in an interview with CNBC, "We don’t need more digital currency. We already have digital currency. It’s called the U.S. dollar. It’s called euro. It’s called the yen. They’re all digital now.” This comes as lawmakers are criticizing Gensler's leadership, saying the lack of clear regulations and harsh punishments for crypto industry players are killing innovation, Decrypt reported.
Major banks have been expressing concerns that crypto could hurt their revenue for years. In its 2019 annual 10-K filing to the Securities and Exchange Commission (SEC), Bank of America Corp warned that the rise of non-depository institutions offering traditional banking products alongside innovative new ones could potentially disrupt the competitive landscape. The bank expressed concerns that this trend could decrease their net interest margin and reduce revenue from their fee-based products and services, Investopedia reported. JPMorgan Chase expressed similar concerns the same year, writing in its filing to the SEC, "both financial institutions and their non-banking competitors face the risk that payment processing and other services could be disrupted by technologies, such as cryptocurrencies, that require no intermediation."
A report by Americans for Financial Reform found that Wall Street spent at least $2.9 billion on lobbying policies and political donations during the 2020 election cycle, CNBC reported.
In response to the lawsuit, Binance released a statement saying that the company is “disappointed” that the SEC has chosen this path, despite the fact that Binance has been trying to cooperate with the SEC’s investigations and address concerns from the agency. “While we take the SEC’s allegations seriously, they should not be the subject of an SEC enforcement action, let alone on an emergency basis,” Binance said. “We intend to defend our platform vigorously. Unfortunately, the SEC’s refusal to productively engage with us is just another example of the Commission’s misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry.”
Brian Armstrong, CEO of Coinbase, responded to its SEC lawsuit with a tweet asserting that the company is prepared to seek judicial intervention to clarify the regulatory ambiguity surrounding the crypto industry. He criticizes the SEC's "regulation by enforcement" approach, arguing that it is detrimental to the United States and implies that taking legal action, if necessary, is a viable course for the company to achieve this clarity.
Todar is an entrepreneur who has been featured on Forbes, Bloomberg, Yahoo Finance, and multiple other outlets, according to his LinkedIn.
