Binance.US Removes Token Amid SEC’s Insider Trading Investigation on Coinbase

Binance.US, the US-based arm of crypto exchange Binance, pulled a minor cryptocurrency in the wake of a Securities and Exchange Commission investigation into insider trading at rival Coinbase.

On August 1st Binance said that it is removing the AMP token from August 15th. According to CoinMarketCap, the cryptocurrency trades for less than a penny with a market cap of less than $400m.

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Despite its small size, AMP has grown because it was one of nine cryptocurrencies cited by the SEC as unregistered securities as part of its investigation into insider trading at Coinbase.

The entire crypto industry has developed without a clear definition of the assets and rules of business within it. The SEC has informally stated that the two largest tokens, bitcoin and ether, are not securities. However, the current SEC chairman, Gary Gensler, and his predecessor, Jay Clayton, both stated that most cryptocurrencies meet the legal definition of a security, potentially putting crypto exchanges in a position to sell unregistered securities.

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Binance said its decision was based on the fact that AMP was only one of nine cryptocurrencies in the insider-trading case that trades on its platform.

“We operate in a rapidly evolving industry and our listing and delisting processes are designed to be responsive to market and regulatory developments,” Binance wrote in a blog post.

Coinbase previously said that it had conducted an internal investigation into the insider-trading allegations and provided information about those allegedly involved in the Justice Department. “Coinbase takes this type of illegal behavior very seriously,” said Paul Grewal, the company’s chief legal officer. “We have zero tolerance for it.”

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While seven of the nine cryptos cited by the SEC trade on Coinbase, the company is adamant that it does not list securities. In a blog post last month, Grewal said that Coinbase has an SEC-review process in place to determine whether an asset is a security, and for this reason the asset has already been determined not to be a security. .

“Coinbase does not list securities. End of story,” he wrote.

This article was first published by The Wall Street Journal, which is part of the Dow Jones

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