BNB Price Risks 40% Drops As SEC Launches Probe Against Binance
The token mainly behaves as a utility asset within the Binance ecosystem, primarily enabling traders to earn discounts on their trading activities.
The price of Binance Coin (BNB) fell by about 7.3 percent to below $275 on the 7th of June, its lowest level in three weeks.
In 2022, the price of BNB might plummet another 25% to 40% as its parent company, Binance, is accused of breaching securities laws and laundering billions of dollars in illicit funds for criminals. BNB was issued as a part of an initial coin offering (ICO) in 2017 that amassed $15 million for Binance.
The token mainly behaves as a utility asset within the Binance ecosystem, primarily enabling traders to earn discounts on their trading activities.
Simultaneously, BNB also functions as a speculative financial asset, which has made it the fifth-largest cryptocurrency by market capitalization.
As a result, the U.S. Securities and Exchange Commission (SEC) is investigating whether the ICO of BNB tokens in 2017 was a sale of securities that should have been registered with the regulator.
This risks putting downward pressure on BNB’s price, which has already lost more than half of its value after peaking out in May 2021 at around $700
The Securities and Exchange Commission’s investigation of the fifth biggest token in the block chain industry has further reissued concerns that regulators may be forced to take action against other cryptocurrency tokens.
On its part, binance earlier told Bloomberg “it would not be appropriate for us to comment on our ongoing conversations with regulators, which include education, assistance, and voluntary responses to information requests . We will continue to meet all requirements set by regulators.”
