As countries like El Salvador forge ahead with adoption plans for cryptocurrencies, a few hardline policies and uncertain investor behavior has prompted lawmakers, particularly the United States’ Securities and Exchange Commission,(SEC), to look into a possible breach of securities law in transactions related to the Tether (USDT) and Binance (BNB) Coin.
To paint a picture, U.S. Attorney Jeremy Hogan covered the top five crypto projects in a video, where he named USDT and BNB as the coins at risk on the SEC’s danger rating. While covering the subject, Hogan showcased his expertise of legal technicalities involved with cryptocurrencies and securities regulations.
New Video: I do a legal analysis of the top 5 crypto-currencies as to how likely it is that the SEC will sue them. If you hold XRP, you know how important this is! ALSO, please help me get to 100k YouTube Subscribers – It's my lifelong dream! THANK YOU!https://t.co/jqeaBjd5eC pic.twitter.com/W1h0Y3sUL1
— Jeremy Hogan (@attorneyjeremy1) June 13, 2021
When trying to figure out how the underlined market caps breached SEC regulations or not, the attorney appears to be using a U.S. Supreme Court reference for “determining whether a transaction qualifies as an investment contract and would be considered a security subject to disclosure and registration requirements”.
How USDT And BNB Could Get The Bad-Cop Treatment From The SEC
In his analysis, Hogan explained how the SEC could initiate legal proceedings against the aforesaid coins, while referencing USDT’s $18.5 million settlement from 2020 with the New York Attorney General. The parent company behind the coin paid the million-dollar fine after reports that it had tried to hide $850 million in losses and and didn’t have enough cash reserves to back the USDTs in circulation.
Hogan’s danger rating for USDT: 9/10
Regarding BNB, the attorney mentions that while the coin does form an “investment of money” attribute, Binance keeps the coin scarce with their buyback policy, citing narratives of undocumented profit as its value rises. This, according to Hogan, has set a bad impression across the SEC block, who’re looking to get a piece of the action as dictated by their rulebook.
Hogan’s danger rating for BNB: 8.5/10
SEC Viewpoint On Regulating Cryptocurrencies
Regardless of Jeremy Hogan’s little heart-to-heart with his avid listeners on YouTube about complications with the USDT-BNB space, the Securities and Exchange Commission (SEC), currently, isn’t too occupied with cryptocurrencies at the moment, reports Decrypt.
Instead, the agency is crafting rules for special purpose acquisition companies (SPACs) in areas concerning short sale disclosures, market reforms and a host of other issues that honestly don’t matter much as far as crypto investors are concerned.
Just for reference, Ripple’s XRP took big dips after facing legal proceedings in 2017 for hiding a few losses from the SEC, but right now, it’s still worth almost $2.75 billion and is the 7th largest cryptocurrency by market cap.
So, whatever happens, rest assured your investments won’t get dented if you have any.