Binance lawsuit could clarify US crypto industry or be a mistake.

The Securities and Exchanges Commission (SEC) has filed a lawsuit against Binance, the world’s largest crypto exchange, accusing it of offering unregistered securities and staking services to the public, which violates U.S. securities laws. However, Jim Bianco, founder of Bianco Research, believes that this lawsuit could become a huge mistake if other countries allow the crypto industry to develop and eventually replace traditional banking. He believes that this lawsuit is another attempt by U.S. lawmakers to drive crypto out of the country.

The SEC previously sued Justin Sun and three of his companies earlier this year for unregistered offer and sale of crypto asset securities, similar to the action it brought against Binance. Some experts welcomed the SEC’s suit, saying that it is warranted and overdue. However, the ongoing lack of regulatory clarity is causing digital asset ventures to leave the United States for friendlier jurisdictions, potentially depriving the U.S. of jobs and innovation at home, according to Richard Mico, the U.S. CEO and Chief Legal Officer of Banxa, a payment-and-compliance infrastructure provider.

The competitive landscape will look quite different, but Aaron Kaplan, co-CEO and co-founder of Prometheum Inc, the parent company of SEC and FINRA-registered digital asset securities trading platform Prometheum ATS and SEC-qualified custodian Prometheum Ember Capital, believes that this meaningful action from the SEC signals the beginning of a shift in the U.S. towards regulated market infrastructure for crypto, which ultimately should help the industry move forward and allow innovation to thrive.

Meanwhile, a Binance spokesperson confirmed that the exchange had received a Wells Notice, a warning from the SEC, earlier this year that ultimately led to a suit. U.S.-based exchange blockchain also received a warning in March that it may face an enforcement action due to its listing of potential unregistered securities. This led to the exchange doubling down on its operations elsewhere, including Canada and Seychelles. Blockchain (COIN) shares dropped 10% on Monday following news of the Binance lawsuit.