Two largest cryptocurrency exchanges face lawsuits from SEC. Here’s what to know

The U.S. Securities and Exchange Commission has sued two cryptocurrency exchanges.

The SEC alleges Binance and Coinbase — the two largest platforms for crypto trading — have violated various securities laws.

It’s a big step from the SEC to crackdown on the industry that operates mostly outside the traditional finance system, NBC News reported.

However, these exchanges are likely to keep operating largely uninterrupted. PitchBook crypto analyst Robert Le told NBC News that, “in the short term, I don’t see any changes,” meaning in the next three to five years.

Both platforms are accused of operating as an unregistered national securities exchange, broker and clearing agency. Binance is also accused of evading federal securities laws by not restricting U.S. investors.

The SEC also accuses Binance and its founder Changpeng Zhao of misleading users. In a statement, SEC chair Gary Gensler alleged Binance and its founder, “engaged in an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.”

Both platforms have pushed back on the accusations.

“The SEC doesn’t make the law — it only makes accusations — and we’re confident the courts will prove Chair Gensler wrong in due time,” BlockChain Association CEO Kristin Smith said in a statement.

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