US Investigating Binance’s BNB Token, World's 5th Largest Crypto Coin, as Over N1.5tn Is Wiped Out in Hours

US Investigating Binance’s BNB Token, World's 5th Largest Crypto Coin, as Over N1.5tn Is Wiped Out in Hours

  • The world's fifth-largest crypto, Binance coin, is currently undergoing investigation in the United States
  • This has sent the coin owned by Changpeng Zhao crashing by over 8.31 per cent in the last 24 hours
  • The US securities commission is looking into the Binance coin as security sent panic across investors with over N1.5trn wiped out in hours

Binance coin, BNB dropped in value amid the United States investigation into the cryptocurrency’s initial coin offering in 2017, increasing the number of government probes that the world’s largest exchange is facing.

The crypto asset is a product of Binance, founded by Changpeng Zhao.

The US Securities and Exchange Commission (SEC) is probing if the BNB coin was unregistered security before it was listed for public offering, according to a Bloomberg report.

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US, Binance’s BNB Token
Zhao Changpeng, chief executive officer of Binance Credit: Andrey Rudakov/Bloomberg
Source: Facebook

US government is investigating Binance U.S, to ensure that the crypto exchange is a standalone from, as required.

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In reaction, Binance was quoted by Bloomberg as saying:

“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.”

Binance further stated that:

“We will continue to meet all requirements set by regulators.” However, this is not the only case involving the firm in U.S, as Zhao’s company also faces probe from the Department of Justice (DoJ)."

Further details on the investigation

The Internal Revenue Service and the Commodity Futures Trading Commission (CFTC) are also looking into the activities of the cryptocurrency exchange, which Zhao split into two; Binance US, solely for citizens of the United States and residents in the country, while services the rest of the world.

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Billions wipe out in hours

Following the report of investigation, the market capitalisation of the BND coin on Monday, 6 June depreciated to $46.97 billion from the high of 50.68bn it started the day, data from coin market shows.

The depreciation of the value of the coin whipped out over $300.7billion(N1.52 trillion) of investors' funds.

However, there has been a slight pick up on Tuesday morning but it is still trading at a negative compared to previous days.

India and cryptocurrency

Meanwhile, earlier reported that India was close to adopting cryptocurrency after several years of vacillating on its position as it sought to meet up with the global move towards digital assets.

The country’s central bank will launch a digital version of its currency, the rupee in the next fiscal year, according to a statement by the country’s minister on Tuesday, February 1, 2022.

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Nirmala Sitharaman, India's Minister of Finance and Corporate Affairs said the introduction of digital currency will accelerate India’s digital economy and lead to a cheaper and more currency management system.


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