Founder and CEO of Binance Changpeng Zhao, commonly known as “CZ”, attends the “CZ meets Italy” at Palazzo Brancaccio on May 10, 2022 in Rome, Italy.
Antonio Masiello | Getty Images
Cryptocurrencies were slightly lower Tuesday, as investors weighed a batch of regulatory updates from Washington involving some of the biggest names in crypto: Binance, Kraken and Tether.
Binance Coin slid 6% after the U.S. Department of Justice has brought criminal charges against Binance and its founder and CEO, Changpeng Zhao, also known as “CZ.” Earlier in the day the coin rose as much as 5% with hopeful investors eager to see the multi-year investigation into the world’s largest crypto exchange resolved.
The move weighed on the rest of the crypto market. Ripple’s XRP fell 4%, Solana was down by more than 6%. Polygon and Uniswap lost 9% and 6%, respectively. Meanwhile, bitcoin was off its lows but down by 1.66%, hovering just below $37,000. Ether was last lower by about 3% at $1,976.13.
Binance falls as the DOJ brings criminal charges against it.
“Markets are whipsawing with each new piece of information, but will start to settle as we head into the U.S. holiday,” said Michael Safai, cofounder and partner at Dexterity Capital. “Remember, most traders haven’t operated in a market where there is no CZ. Any upside from the settlement may be met with some temporary selling pressure as the market considers how Binance moves forward. But crypto veterans have seen this play out before.”
“It’s hard to see Binance losing its dominance, but this will certainly create room for newer players to fill any void,” he added.
Investors were also weighing news from another major crypto exchange: Kraken. On Monday evening, the Securities and Exchange Commission alleged that the company has been operating as an unregistered broker, clearing agency and dealer and that it commingled customers’ crypto assets with its own.
This is the second time this year the SEC has sued Kraken. In February the agency said Kraken failed to register the offer and sale of the crypto asset staking-as-a-service program.
Meanwhile, the DOJ on Tuesday commended Tether, the controversial operator of the biggest stablecoin in the crypto ecosystem, for its efforts in freezing $225 million of assets linked to a human trafficking syndicate in Southeast Asia.
