Regulators attack Binance, market reacts calmly

The Commodity Futures Trading Commission (CFTC) filed a lawsuit against Binance and its CEO Changpeng Zhao (CZ). The CFTC accuses Binance and its founder of illegal derivatives trading in the United States. The CFTC also alleges that Binance traded on its platform with 300 accounts directly or indirectly owned by CZ (insider trading). Here’s what we know about that.

Regulator attack as routine

The cryptocurrency market reacted with a mild 2% drop — Bitcoin fell to $26,800, Ethereum rolled back to $1,786. Given the importance of the news and a strong FUD, we are seeing a mild version of the correction, which can be assessed as a positive.

In response to what’s going on, CZ denied the accusations against itself, and posted the number 4, referring to an old tweet with plans for 2023, among which the number 4 goal is to ignore FUD, fake news and attacks.

Justin Sun, founder of Tron, also supported his colleague by posting the “4” on his Twitter. Justin Sun himself was attacked by U.S. regulators last week, as if passing the baton to his colleague.

Banking crisis continues

Amid attacks on the crypto industry, the attempt to stabilize the U.S. banking system continues. For the first time since 2020, the Fed again entered the repo market. Transactions totaled $60 billion during the week:

This usually happens when banks suddenly stop lending to each other, so we have to use an emergency source of liquidity — the Fed itself. The Fed’s entry into the interbank repo market is extremely rare, and it is always a sign of a dangerous situation in the banking sector.

Important events ahead

• On March 29, the EU will vote to ban anonymous transfers of large amounts of crypto assets from its own wallet. If this law passes, it will have serious consequences for EU crypto companies such as cryptocurrency exchanges.
• According to the defense attorney, the judge’s decision in the Ripple case will be announced and will take effect in the coming weeks (possibly this week). This precedent will have a huge impact on the crypto industry.
• Markets are waiting for the next FOMC meeting on May 3, when the Fed will again decide the fate of the interest rate. According to experts’ estimates, this rate most likely will not change — market participants now estimate the probability of such an event at 88%.

New term

Coinbase came up with a new term — Flatcoin. It is a new kind of stablecoin that represents an index of different currencies. Coinbase is going to create its own kind of stablecoin, which would additionally protect the asset from inflation.