Volatility Strikes Crypto Markets
The crypto market experienced a significant level of volatility on November 21st following the announcement of a $4.3 billion settlement between the United States Department of Justice (DOJ), Commodity Futures Trading Commission (CFTC), and U.S. Treasury with Binance. As part of the settlement, former Binance CEO Changpeng Zhao will plead guilty to one felony charge related to criminal and civil cases involving the cryptocurrency exchange.
Guilty Plea and Financial Penalties
United States Attorney General Merrick Garland revealed that the DOJ reached a resolution with Binance and CZ, which included a guilty plea from CZ for willfully violating the Bank Secrecy Act. In addition to the guilty plea, Binance must also file suspicious activity reports and review past transactions to report any suspicious activity to federal authorities. These measures aim to further criminal investigations into cybercrime and terrorism financing through the use of cryptocurrency exchanges.
Market Reaction and Continuing Fluctuations
Following the announcement, the crypto market has continued to experience fluctuations in price. Bitcoin (BTC) registered a 1.79% loss, trading near $36,700, while altcoins showed a slight recovery from earlier losses. The market volatility reflects participants' efforts to digest the details of the U.S. government's enforcement action against the crypto industry on November 21st.
Pre-Existing Awareness and Impact on Binance Coin
Although the crypto market does not have an opening bell like Wall Street, market participants and traders were already aware of the settlement prior to Garland's press conference. Prices had already reacted, with Binance Coin (BNB) reaching a 5-month high before retracing most of its gains. This occurred even before the press conference took place.
User Response and Hope for the Future
Despite the negative news surrounding Binance, users of the exchange are not rushing to exit the platform or centralized exchanges in general. According to Glassnode, the net Bitcoin position change on Binance is significantly lower than the numbers seen in January and July. The crypto community is also expressing support for the decision, viewing it as a step towards closing a chapter and hoping for positive progress within the industry as a whole.
