Investor and Shark Tank star Kevin O’Leary in an interview Decrypt said that “crypto cowboys” will soon become a thing of the past, since SEC threw a “legal lasso” on the two largest bitcoin exchanges – Binance and Coinbase.
In his opinion, the regulator’s lawsuits against trading platforms will be remembered as a turning point in the industry, which will ultimately help the entire crypto market become “greener”.
“I think as an industry we will leave the past behind and find a new future. [Криптовалютные] technology offers so much, but it’s mired in an unregulated, cowboy environment,” O’Leary added.
On June 5, the SEC sued Binance and its CEO Changpeng Zhao. The regulator brought 13 charges, including the sale of unregistered securities.
O’Leary sees the increased regulatory oversight that the digital asset industry has faced in the wake of the FTX crash as a good sign.
Enforcement action by the SEC is likely to decapitate Binance, he said, despite what company management thinks or claims.
He noted that the regulator demanded a freeze on Binance US assets. This situation will also put pressure on the platform as clients will start withdrawing their funds sooner or later.
The businessman suggested that the litigation would also affect the expansion of the company outside the jurisdiction of the United States.
“The truth is that a regulated exchange is far less profitable than an unregulated scam. […] Perhaps you go into the shadows and play only in fraudulent markets, but slowly but surely you will not have enough oxygen, ”added the entrepreneur.
Coinbase’s legal troubles are “an entirely different story,” says O’Leary. In his opinion, the second largest crypto exchange in terms of trading volume is facing an uphill battle, but it is not as fierce as that of Binance.
However, he noted that the company’s decision to “enter the ring” with the Commission alienates institutional clients and negatively affects its share price.
“The idea that you can beat the SEC — an institution with unlimited resources that has made a very targeted attack — is not easy, and it’s not good for investors,” he said.
On June 6, the SEC filed a lawsuit against Coinbase. The regulator also alleges that the platform violated securities laws.
Recall that the founder of Cardano Charles Hoskinson shared his opinion about the litigation. He believes that the SEC case against Binance is motivated by the “political and philosophical disagreement” of the department with the very existence of cryptocurrencies.
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