“Crypto market shows signs of stabilization after a sharp sell-off triggered by SEC lawsuits against Coinbase and Binance. While some tokens continue to drop, the pace has slowed down, with others recovering at single-digit percentages. Cardano and Ripple’s XRP see modest gains, while Binance’s BNB and Solana’s SOL remain down.”
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The cryptocurrency market is showing signs of stabilization on Monday following a significant sell-off last week triggered by lawsuits filed by the U.S. Securities and Exchange Commission (SEC) against Coinbase and Binance for securities violations. While some tokens are still experiencing minor declines, the rate of drop has slowed down, and a few tokens are seeing single-digit percentage recoveries, indicating a firmer price trend at the beginning of the new week.
Cardano (ADA), the seventh most valuable cryptocurrency, has risen more than 1% in the last 24 hours, and Ripple’s XRP, ranked sixth, is up almost 1%, according to CoinMarketCap. However, Binance’s BNB token and Solana’s SOL are still down 4% over the last day. Bitcoin and ether, the two largest cryptocurrencies, have remained relatively flat.
Over the past week, four out of the top 10 coins by market capitalization have experienced value plunges of at least 15%. Cardano’s ADA has been hit particularly hard, with a decline of over 28% in the last seven days. Binance’s BNB token slid 25%, and Polygon’s MATIC tumbled over 29% during the same period. The SEC filed lawsuits against Coinbase and Binance, accusing them of selling unregistered securities and other charges. The SEC alleged that Coinbase operated as an unregistered exchange and broker and identified 13 assets listed on its platform as crypto asset securities, including Solana’s SOL, Cardano’s ADA, and Polygon’s MATIC. On Monday, the SEC also accused Binance of misleading customers, inflating trading volumes, and diverting customer funds.
Dave Weisberger, CEO and co-founder of CoinRoutes, a crypto algorithmic trading solutions provider, stated that Coinbase approached the SEC seeking clarity, suggesting that these companies are open to regulation from authorities. He believes that the cryptocurrency asset class poses a threat to the global financial institutions’ oligopoly.
SEC Chairman Gary Gensler, in an interview with CNBC after the lawsuits were filed, expressed that “we don’t need more digital currency.” He emphasized that the investing public benefits from U.S. securities law, and crypto platforms and intermediaries need to comply with the same regulations. Gensler, appointed by President Joe Biden in 2021, has been actively cracking down on crypto firms and exchanges over the past year.
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