The recent conflict between the Securities and Exchange Commission (SEC) and Binance seems to be motivated by resentment on the part of Gary Gensler, who is said to have offered his services to Changpeng Zhao’s platform in 2019, which then refused the offer.
SEC and Binance, a tug of war against a backdrop of resentment
Binance’s defence lawyers have revealed in a court filing that Gary Gensler, the chairman of the Securities and Exchange Commission (SEC), had expressed an interest in advising the cryptocurrency exchange in 2019.
At the time, Gary Gensler was a professor at the Massachusetts Institute of Technology (MIT), where he mainly taught economic principles. In fact, he was reportedly approached by various companies during his teaching years, and turned them all down.
And even Binance reportedly offered Mr Gensler the chance to join its ranks in 2018, a year earlier than his change of heart. More specifically, according to a report by the Wall Street Journal published in March, the current SEC chairman was even said to have been accommodating with the world’s leading cryptocurrency exchange platform:
” Ella Zhang, then head of Binance’s venture capital investment arm, and Harry Zhou, met with Gensler in October 2018, according to their exchanges. Mr Zhou wrote: “I observe that although Gensler declined to be an advisor, he was generous in sharing licensing strategies. “
So would Gary Gensler have changed his mind between that first meeting and his application to Binance in 2019? Whatever the case, since being sworn in as SEC chairman in April 2021 by Joe Biden, Gensler seems to have some unfinished business with Changpeng Zhao’s platform.
Although Binance’s CEO has not reacted publicly to the news, he did point out in a tweet that the SEC has simply failed to protect investors in a number of recent situations, including the collapse of Voyager Digital, Celsius, BlockFi, Grayscale and, of course, FTX.
Reminder, Gensler’s SEC:
FAILED to catch FTX ($8bn fraud & bankruptcy)
FAILED to protect Grayscale investors ($8bn impairment)
FAILED to protect Voyager, Genesis, BlockFi borrowers ($4bn+ bankruptcies)
It’s not that he’s mean, it’s that Gensler is an incompetent, crooked cop.
– Ryan Selkis (@twobitidiot) June 7, 2023
Binance is currently facing accusations from the SEC, which accuses it of mixing customer funds with its own, and of operating illegally on US soil, among other things.
The CZ exchange had already been dealt a heavy blow by the CFTC last April, which led to a relative loss of market share in the crypto exchange market.
