SEC-induced panic saw $53 billion wiped from crypto market SEC-induced panic saw $53 billion wiped from crypto market
A market wide sell-off triggered by regulatory enforcement action against Binance sees crypto markets sink 4.7%.
2 min read
Updated: Jun. 6, 2023 at 9:56 am UTC
Cover art/illustration via CryptoSlate. Image includes combined content which may include AI-generated content.
The total crypto market cap fell $53 billion as news of the U.S. Securities and Exchange Commission (SEC) filing against Binance came through.
On June 5, the SEC charged Binance, its CEO Changpeng Zhao, and related entities with 13 violations, including wash trading, evasion of regulations, and offering unregistered securities.
Binance said it was disappointed with the complaint and had always worked cooperatively with regulator’s inquiries. However, it disputed the enforcement action and intended to “vigorously” defend the charges.
A key component of Binance’s defense centers on the SEC’s purported unwillingness to provide regulatory clarity. It further claimed that the company was a victim of the ongoing “regulatory tug-of-war,” in which government agencies seek to “claim jurisdictional ground from other regulators.”
“Unfortunately, the SEC’s refusal to productively engage with us is just another example of the Commission’s misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry.“
Crypto markets crash
Markets tanked on the news of the SEC filing against Binance.
On June 5, at 16:00 BST, just before the news broke, the total crypto market cap was valued at $1.13 trillion. As word spread, the ensuing dump bottomed at $1.08 trillion approximately an hour later – equating to a $52.7 billion, or 4.7%, drawdown.
A bounce followed to top out at $1.1 trillion. The market has since traded flat as participants consider the gravity of the situation, particularly the allegations that several third-party tokens were named as securities in the SEC filing, including ADA, SOL, and MATIC.
Biggest winners and losers
Of the top 100, the biggest losers over the last 24 hours were Pepe, The Sandbox, and Sui, which lost 15.2%, 14.8%, and 12.7%, respectively. The Sandbox was named as an unregistered security in the SEC filing.
Kava was the only top 100 token (excluding stablecoins) to stay green over the period, which grew 9.6%.
Market leader Bitcoin suffered a peak-to-trough loss of 5% to find support at $25,400. It has since peaked at $25,890 but is shaping to retest $25,600 support.
Mentioned in this article
Author 
Samuel Wan
Samuel Wan, a finance professional turned full-time crypto content creator, values individual autonomy and personal freedom in his pursuits.
Editor Editor 
Liam 'Akiba' Wright
Also known as "Akiba," Liam is a reporter, editor and podcast producer at CryptoSlate. He believes that decentralized technology has the potential to make widespread positive change.
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Bitcoin, a decentralized currency that defies the sway of central banks or administrators, transacts electronically, circumventing intermediaries via a peer-to-peer network.
Kava
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Kava is a lightning-fast Layer-1 blockchain featuring a developer-optimized co-chain architecture that combines the two most used permissionless ecosystems – Ethereum and Cosmos – into a single, scalable, network.
Solana
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Solana is a high-performance blockchain platform that utilizes a unique consensus algorithm called “Proof of History” to achieve fast transaction speeds and low fees.
Cardano
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Cardano is a decentralized public blockchain and cryptocurrency project and is fully open source.
Polygon
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Polygon, a prominent layer 2 scaling solution on Ethereum, has emerged as a multifaceted and scalable platform, enhancing the Ethereum ecosystem’s capabilities.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Binance.US
Binance.US will provide secure and reliable cryptocurrency trading to users in the United States.
Changpeng Zhao, popularly known as “CZ,” is a notable figure in the cryptocurrency world, primarily for founding and leading Binance, the world’s leading cryptocurrency exchange by trading volume.
