Bitcoin fell below $61,000 in the short term. The major exchange Mt.Gox will repay 142,000 Bitcoins, which is a negative impact. Creditors do not rule out profit-taking, which has exacerbated the selling panic in the crypto market. The former richest Chinese, Zhao Changpeng (CZ), was imprisoned. The US Securities and Exchange Commission still does not give up on pressing Binance.US. The exchange emphasized that it is ready for a long-term legal battle.
The news of Mt.Gox compensating creditors was released at the beginning of this year, but the market is currently worried that since Bitcoin has risen from US$850 to over US$60,000 since February 2014, creditors may trigger a wave of selling.
People in the cryptocurrency industry believe that Bitcoin has increased nearly 74 times since 2014. After creditors receive compensation, there will inevitably be a wave of selling pressure. In particular, people who hold a large number of Bitcoins are more likely to realize some profits, which may also cause panic among other investors, who will then follow suit and sell Bitcoin.
Secondly, judging from the repayment plan that Mt. Gox provided to its creditors, the plan includes basic repayment and proportional repayment. The basic repayment requires creditors to pay the first 200,000 yen in Japanese yen, while the proportional repayment can be chosen as an early lump-sum repayment or mid-term repayment and final repayment. The former is paid partly in cash and partly in Bitcoin or Bitcoin Cash (BCH), while the latter will be repaid in installments at the end of September and in the next few years, respectively. That is, the actual compensation obtained by the creditors is not entirely in Bitcoin, and they will not necessarily receive the compensation amount all at once, which reduces the possibility of a single creditor selling a large amount of Bitcoin at one time.
However, selling pressure does not necessarily mean that prices will plummet. According to analysis by cryptocurrency industry insiders, the news of Mt. Gox's compensation was released as early as the beginning of this year, and the panic caused by the news has probably been almost reflected. Creditors have been waiting for compensation for ten years. This group of early investors in the crypto market will not be in a rush to cash in their virtual assets, especially since some of them may insist on holding on to their assets for the long term.
Despite this, in the short term, selling sentiment remains strong.
There is still uncertainty about the SEC's regulation of the cryptocurrency industry after the regulator sued Binance US and its founder Changpeng Zhao. Binance US is the US branch of Binance, the world's largest crypto exchange, and is preparing for a legal showdown with the SEC.
Binance US said it is ready for a long legal investigation. The company emphasized: "Last Friday, the court ruled that the SEC's lawsuit against Binance US will continue. We are ready and look forward to the case moving forward in the judicial process."
The SEC's charges center around securities law violations, including offering unregistered investment products and antifraud violations.
Binance US reiterated its commitment to serving U.S. customers in full compliance with U.S. regulations.
“We maintain a 1:1 reserve on all customer assets and have a robust compliance and risk management program to ensure the safety, security and integrity of our platform,” the exchange said.
Binance US also criticized the SEC's regulatory approach, calling it "regulation through enforcement." The company attributed its legal challenges to politically motivated actions by the administration led by SEC Chairman Gary Gensler. Binance US stressed: "Unfortunately, we, like many companies in the industry, have become victims of politically motivated excesses and regulation through enforcement under the current leadership of the SEC."
Binance said that after an 11-month investigation, the SEC has not been able to find any evidence of any wrongdoing by Binance USA. The company believes that the SEC's case is neither factually nor legally consistent.
However, the U.S. court did not dismiss most of the SEC’s allegations against Binance US in a court filing on June 28. The filing also supported the regulator’s allegation that Zhao Changpeng acted as a “controlling person,” an allegation that Binance sought to dismiss.
