The recent United States Securities and Exchange Commission (SEC) lawsuit against Binance exchange has caused concern among the crypto community. Analyst and writer Marcel Pechman recently discussed the impact of the lawsuit in the latest episode of The Market Report.
According to Pechman, the most likely outcome of the lawsuit is that the U.S. population will be barred from using the international version of Binance. Those who opt for VPN services will be at risk of being prosecuted. Pechman believes that Changpeng “CZ” Zhao and Binance will either lose the lawsuit or strike a deal pleading guilty. The company will then pay a fine and be forced to halt services for North American entities, including Paxos and the Binance USD (BUSD) stablecoin.
Despite these concerns, Pechman believes that Binance’s international operations will remain fully operational in the worst-case scenario. He believes that the recent 5% price correction on April 5 was a “vote of confidence” from traders. They believe that Binance will continue to operate despite the SEC lawsuit. Pechman cites the outcome of the BitMEX lawsuit, where every client was made whole despite the company paying a hefty fine, as an example of similar outcomes for Binance.
The SEC also labeled 10 tokens as securities in the lawsuit. North Americans will not be blocked from buying or holding these altcoins. However, they will need to take an extra step to trade them, such as using a decentralized exchange.
Pechman notes that the Coinbase lawsuit differs from Binance’s. The U.S.-listed company has a huge base of North American clients and cannot move its operations abroad without a significant reduction in user base and volumes. Binance has other issues involved, such as money transfers between related entities and the potential illicit use of client funds.
The first read for Coinbase shows a much lighter case, very unlikely to become something more eventful, while Binance and CZ’s odds of facing the Department of Justice and criminal charges are much higher. Regardless of these lawsuits, Pechman believes that a crypto bull run will happen. This is because the U.S. Federal Reserve continues to print trillions of dollars to sustain the economy.
Finally, The Market Report discusses whether the Bitcoin price will retest the $24,000 level. The long/short ratio hit levels unseen in over 12 months. The show airs every Tuesday on the Cointelegraph Markets & Research YouTube channel.
In conclusion, the SEC lawsuit against Binance has caused concern among the crypto community. Analysts believe that North Americans will be barred from using the international version of Binance, and Binance may either lose the lawsuit or strike a deal pleading guilty. However, traders believe that Binance international will remain fully operational. The Coinbase lawsuit differs from Binance’s, and the odds of facing criminal charges are much higher. Regardless of these lawsuits, a crypto bull run will happen, according to Pechman.