Bitcoin rebound falters amid SEC crackdown on exchanges, raising chance of a BTC price capitulation
Bitcoin’s price lost steam after a failed retest of the $27,400 resistance on June 6, signaling that investors became less confident after the recent regulatory actions by the United States Securities and Exchange Commission (SEC) against Binance and Coinbase. Both exchanges are being sued on multiple counts, including failure to register as licensed brokers and offering unregistered securities.
According to Blockchain Association CEO Kristin Smith, the SEC is trying to circumvent formal rulemaking processes and deny public engagement. Meanwhile, Insider Intelligence crypto analyst Will Paige said the SEC’s intent is to police the space through enforcement in the absence of a regulatory framework.
Those criticisms explain why investors may be clinging to their hopes in the U.S. Financial Services Committee hearing scheduled for June 13.
The potential overreach of the SEC has caused ripples multiple times, including in the U.S. legislature. Sen. Bill Hagerty, for instance, stated that regulators at the SEC are “weaponizing their role” and publicly called out SEC Chairman Gary Gensler.
The @SECGov is weaponizing their role to kill an industry. Allowing a company to list publicly and then stonewalling their attempts to register is indefensible. @GaryGensler, expect to hear from Congress.https://t.co/GdprSW1Yns
Further supporting the thesis that the cryptocurrency space can function without crypto-banks, as the centralized exchanges are commonly known, is the sudden increase in decentralized finance volumes.
The median trading volume across the top three decentralized exchanges (DEXs) jumped 444% between June 5 and June 7. As DEX volumes surged, net outflows on Binance reached $778 million, the difference between the value of
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