Regulators worldwide intensify their scrutiny of the crypto industry, the CFTC files a lawsuit against Binance for evading US regulations, G7 finance leaders prepare to discuss tighter crypto rules following FTX’s collapse and bank failures, and Huobi advisor Justin Sun faces SEC fraud charges, potentially impacting the company’s VASP license application in Hong Kong.
CFTC Targets Binance for Evading US Regulations
Lately, US regulators have been targeting more and more crypto market players. Making headlines now is the suit filed by the Commodity Futures Trading Commission (CFTC) against Binance, as an outcome of an investigation started in 2021, for allowing US citizens to access their platform and transact in BTC, ETH and LTC without registering with the derivatives regulator.
Internal communication from Binance revealed that the entity knowingly and willingly did so by obfuscating the locations of its executive offices, as well as their identities.
The full details of the lawsuit and allegations against Binance can be read here.
G7 Finance Leaders to Tackle Crypto Regulations in the wake of FTX Collapse and Bank Failures
The G7 is a group of seven countries with the most advanced economies (Canada, France, Germany, Italy, Japan, the United Kingdom, and the United States; the EU is an active participant, however, not an enumerated member) and its presidency rotates annually, currently held by Japan. Its aim is to address transnational issues, such as financial stability, international security among others.
Days before the annual Leaders’ Summit is hosted in May, the group will discuss, in a meeting of finance ministers and central banks, the tightening of crypto regulations in order to protect consumers and promote business transparency, as an outcome of FTX’s collapse and the failure of Silicon Valley Bank and Signature Bank.
Although it issues policies, the G7 is not a formal entity, thus with no legislative or authoritative power to enforce them. The efforts, statements and reports issued by G7 are valuable for international and national organizations from various fields as resource tools in supporting their work and advance national legislation.
Huobi Advisor Justin Sun Faces SEC Fraud Charges
Justin Sun, who serves as an adviser to Huobi Global, has been charged with fraud, by the U.S. Securities and Exchange Commission, due to selling two unregistered crypto tokens and manipulating trade in one of his three companies. Huobi moved its headquarters from Singapore to Hong Kong and is in the process of obtaining a VASP license from Hong Kong’s Securities Futures Commission (SFC).
The new charges brought against Sun may have negative repercussions for Huobi’s application.
Hong Kong’s new licensing framework goes into effect in June 2023, which will allow retail investors to trade cryptocurrencies. Currently there are only two licensed exchange platforms in this territory and only high net-worth individuals are allowed to trade crypto on one of them.