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Binance faces even more trouble as influencers get sued

GB Market Commentary 03/04/2023

by Marcus Sotiriou


Bitcoin remains below $28,500, as it fails to close a daily candle above this key level despite 8 touches. This shows how strong this resistance is, and until we can hold above this level, we should be cautious in the short term.


This week, both ISM and Payrolls are due in the US, which will have a big impact in determining the Fed’s next policy decision in May. ISM services is released on Wednesday, JOLTS on Thursday and Payrolls on Good Friday (this is a public holiday so the Dollar will be a good indicator as the market’s response initially due to a thin FX market.


The recent surge in global markets can be put down to the market discounting rate cuts starting this summer, as rates are the key driver for market liquidity. Nonetheless, the Federal Reserves maintains their stance of rates being higher for longer until we see clearer signals of inflation trending down.


Binance seems to be in trouble as their $1 billion BUSD fund is down to $113 million BUSD currently, as we can see on chain. In addition, Binance influencers are now facing lawsuits totalling $1 billion for trading unregistered securities and Binance is being sued for paying influencers for their promotion. NBA star Jimmy Butler and Ben Armstrong have been included in the lawsuit, and more influencers will be called out in future filings.


This comes after Binance suffered a harsh blow from the CFTC recently. This lawsuit from the CFTC shouldn't be taken lightly. The CFTC takes less cases against crypto than the SEC but when they do they come in with force. The report refers to 300 "house accounts" owned by CZ, Merit Peak and Sigma chain used in proprietary trading, suggesting that Binance was counterfeiting its customers. The damning part is that the CFTC has chat records and other documentation from CZ directly on these matters to prove this. Settlement could be the best case here for Binance, but that could still be billions in fines to cover making whole, disgorgement and civil penalty payments but may allow CZ et al to avoid admission of guilt. This lawsuit doesn't seem to be FUD this time.


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