Crypto Prices Drop as SEC Files Lawsuit Against Binance, Smart Money Seizes Buying Opportunity

Crypto Prices Drop as SEC Files Lawsuit Against Binance, Smart Money Seizes Buying Opportunity

As news broke of the US Securities and Exchange Commission (SEC) filing a lawsuit against Binance, cryptocurrency prices experienced a significant decline. However, savvy investors recognized this as an opportunity to buy the dip and show support for the prominent crypto exchange.

According to data from Etherescan, FalconX, an institutional crypto trading platform, received 37 million USDC from Circle and subsequently deposited 29.5 million of those stablecoins into Binance.

Investors Take Advantage of Binance Crackdown Since the SEC’s lawsuit against Binance, leading cryptocurrencies have seen notable price drops. Bitcoin, for instance, is currently trading at $25,700, marking a decrease of over 4% in the last 24 hours, while ETH is trading at $1,816, down 3% during the same period. Binance’s native token BNB has experienced a decline of nearly 8% in the past 24 hours.

Some astute investors saw this as an opportune moment to capitalize on the dip. Etherscan data reveals that Cumberland, a specialized crypto trading and market making firm, withdrew 67.9 million USDC from Circle and deposited 67.1 million of those stablecoins into Coinbase.

Additionally, blockchain investment firm FBG Capital deposited 44 million USDT into Binance following the SEC’s crackdown. Lookonchain identified a significant crypto whale who withdrew 703,871 USDC and over 2.5 million USDT from the decentralized finance platform Aave before purchasing approximately $3.35 million worth of Ether at an average price of $1,810.

Despite the upheaval caused by the SEC lawsuit, the crypto market’s overall volatility has remained relatively unaffected. While prices of leading cryptocurrencies have decreased across the board, low volatility and compressed implied options volatility suggest an expectation of continued market stability.

Noteworthy figures within the crypto industry have expressed their support for Binance amid the SEC lawsuit. BitMEX co-founder Arthur Hayes tweeted that the market’s downturn is a result of “Binance FUD” (fear, uncertainty, and doubt) and expressed optimism for the future. Changpeng Zhao, the CEO of Binance, conducted a poll among his followers, asking who provides better investor protection: Binance or the SEC? The majority of respondents favored Binance.

As the world’s largest crypto exchange by trading volume, Binance has been subject to investigations by various regulatory bodies in the US, including the CFTC, SEC, IRS, and even the Department of Justice.