Explain this to Me Like am a Five Year Old

[alastantiger]

The above is a summons from the US District Court for Binance CEO CZ. The past two days have been really hectic for me, as I've been trying to understand what's happening with the SEC, Binance, and Coinbase, but I'm not getting a clear picture. Can someone please explain to me, like I'm 5 years old, what the hell is going on?

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?
• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?
• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?
• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?
• What message is the SEC trying to convey to other nations, especially their allies?

[FlyingDream]

You asked five questions.

1.
The SEC believes it should regulate certain things that Binance currently does outside of its regulation. This legal action will force the courts to decide whether or not the SEC can really do what they want to here. That's why the SEC is doing this: to try to get the courts to tell everyone that the SEC gets to regulate Binance (and others) the way it wants to.

2.
CZ can make arguments about why he shouldn't have to appear, but at the end of the day the court gets to decide who's right and who's wrong. CZ could lose a court case by default, just like a football team could lose a game by default if they don't show up and play.

3.
You're repeating question #1, we've already discussed the SEC's motive here.

4.
Binance leaving the US would have a huge impact on Binance. Bitcoin would also be affected, one can only assume. The US is a much larger entity then both, so the impact on the US wouldn't be as great.

5.
The SEC is not doing this to send a message to foreign jurisdictions. The SEC is attempting to establish precedents in the US court system, as previously mentioned.


Of course there's much more I could say on this subject, but a stupid five-year-old like you wouldn't understand.

[dzungmobile]

You don't need to have any answer at the moment.

What you must do is withdraw your money from Binance and store it in your wallet. You can wait months to see the dust settles down and have answers for all those questions or might be not.

Answers are not helpful to keep your money safely. You can keep your money safely by withdrawal after which you don't have to mind what will happen with Binance and SEC. At least your money will be safe but if you are more worrying about it, cash out your cryptocurrency and avoid crypto market crash, stable coin de-pegs.

You don't have to believe in Binance and CZ because it's your money. A joke is SEC did not sue FTX. 

[joniboini]

• What message is the SEC trying to convey to other nations, especially their allies?

I'm not really sure if a single decision by SEC makes other countries will follow them blindly. Not to mention there is also dissatisfaction with SEC inside the US. AFAIK, they get sued by Coinbase regarding regulation clarity and they have yet to respond. They even get a deadline to respond within a week or so[1].

At the end of the day, they are trying really hard to make most tokens classified as security and sue exchanges left and right. The end goal is definitely to gain control over the market. As others have mentioned, better to be safe than sorry. Withdraw your money if you have any, and use other platforms if you need to trade your crypto (or look at P2P).

[1] https://decrypt.co/143673/us-court-gives-sec-one-week-to-respond-to-coinbases-rulemaking-petition

[ImThour]

SEC just wants to knock down the biggest Crypto exchange in order to get people investing back into stocks that their members can pump and dump easily.
The crackdown on Binance will lead to a collapse in the market, which might also give them an opportunity to buy as the fear increases.

What message is the SEC trying to convey to other nations, especially their allies?

It's more like countries which have big Stock Market are complying together to bring down the Cryptospace.

[Darker45]

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?
• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?
• What message is the SEC trying to convey to other nations, especially their allies?

These are pretty much the same questions.

We probably don't know what the SEC really wants, what their ulterior motives are, if there are any, or whether they're just trying to send a strong message. If we assume regularity, then the agency is simply performing its mandate.

To be specific, what they're simply pointing out is that Binance has committed violations so they have to be brought to court. The agency is filing 13 charges all in all. 

What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?

It will hurt all three of them. It will hurt Binance, of course. That's obvious. It will hurt the US as well. We have all been hearing the cries of crypto companies in the US because of how bad the regulatory environment is. And it will also hurt Bitcoin. And, therefore, us. But whatever happens, Bitcoin will recover from this in due time.

What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?

I'm not a legal expert, but since this is a civil case I guess nobody will go to prison. Heavy damages will be collected, though.

If the charges are left unanswered, I guess the court will pass judgement without hearing the side of the defendant. Needless to say, the upper hand will be on the part of the plaintiff, and they will probably win it. And whatever appropriate legal punishment due to the violations enumerated shall be imposed on Binance. 

[CryptoBuds]

In my opinion, Binance and Coinbase are the two exchanges considered the mainstays of the crypto industry, and the SEC attack on these 2 companies seems to be hitting the entire crypto industry. If they win this war, they will continue to attack and legally take over the industry. Their aim is still to control and manipulate the entire market, but many people don't understand the problem and get too excited when they see the SEC attacking centralized exchanges, and they think it's good for bitcoin.

[retreat]

The above is a summons from the US District Court for Binance CEO CZ. The past two days have been really hectic for me, as I've been trying to understand what's happening with the SEC, Binance, and Coinbase, but I'm not getting a clear picture. Can someone please explain to me, like I'm 5 years old, what the hell is going on?

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?
• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?
• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?
• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?
• What message is the SEC trying to convey to other nations, especially their allies?

In short, the SEC considers that Binance and Coinbase violated their rules and whether they like it or not they have to answer the summons to buy an explanation regarding their accusations and if they do not comply with this, their business will be unregistered and may have their operations closed in the US. If Binance and Coinbase do not heed this call (which is unlikely) it will have a significant impact on the crypto market, given that Binance US and Coinbase are large CEXs and their operations could impact the crypto market.

As for the US itself, they will also be affected, even if it's not too massive, but it will be quite detrimental for them. Therefore the SEC also gave about 21 days so they could negotiate and explain what these officials wanted. 21 days is quite a long time and it could very well be used to negotiate with the these officials.

[Helena Yu]

No one can answer it, because it's full of speculation and conspiracy, we can only make a guess.

No one know what SEC is trying to get in this case and as you know human is really hard to understand.

SEC is just crackdown on Binance, that's.

What anyone should do is move their money to a non custodial wallet and try to learn to use a decentralized exchange or P2P sites to make sure you're invulnerable against of centralization.

[adaseb]

Originally it was assumed they were getting sued for listing tokens which are considered securities like SOL and ADA. And coinbase also has this issue.

However today there was evidence that CZ might of used US customer funds to trade with them without their permission. Basically after silvergate and signature went bust, they looked at their records and found that they moved customer funds to CZ and that was used to trade, so no different than SBF.

[Upgrade00]

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?
• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?
• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?
• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?
• What message is the SEC trying to convey to other nations, especially their allies?

• On paper they would claim they want to enforce the rule on unregistered securities and also any other exchange compliance rule that binance may have broken.
• His presence in court does not affect the final judgement.
• I have not seen any evidence to support this.
• Binance leaving the U.S, would hurt U.S based investors but only slightly, it would hurt binance a lot more as they would lose a lot of customers to their competitors.
• Again, no idea as yet.

[Wexnident]

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?
• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?
• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?
• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?
• What message is the SEC trying to convey to other nations, especially their allies?

SEC filed charges cause they saw something, simple as that. They're simply following their assumption that CZ broke the law or something similar. Now CZ going under would potentially also mean Binance going under, so that's that.

Wouldn't CZ lose the case immediately if he doesn't appear? Not familiar with law stuff mb.

As for the rest, all in all I think the community is over exaggerating things because there's no clear reason as to what's going to happen. In all honest, Binance shutdowns as the worst case but I doubt its going to give any permanent damage to the crypto scene. Unless, ofc, they finally release a clear set of laws that go against/reject crypto itself due to this case but eeeehhh I think the cases is more about the running of the exchanges itself than crypto.

[Z-tight]

What does the SEC really want? Do they want to shut down Binance US and Bitcoin?

BTC cannot be shut down, it is not a centralized service like Binance that the government can give orders and seize, an attack on Binance is an attack on Binance and not BTC, Binance is not BTC, neither is it 'BTC's bank'.

What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?

It will surely have its implications, so many shitcoins would be flushed out of the market. BTC price will plunge in the short term but the price will recover in the long period, another implication is that it will teach people to store their funds in self custody and not in any exchange.

[Oluwa-btc]

What does the SEC really want? Do they want to shut down Binance US and Bitcoin?

BTC cannot be shut down, it is not a centralized service like Binance that the government can give orders and seize, an attack on Binance is an attack on Binance and not BTC, Binance is not BTC, neither is it 'BTC's bank'.

What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?

It will surely have its implications, so many shitcoins would be flushed out of the market. BTC price will plunge in the short term but the price will recover in the long period, another implication is that it will teach people to store their funds in self custody and not in any exchange.

Correctly said, the way one can be attacked is when you have your BITCOIN controlled and maintained by Binance. The government and United States Exchnage commission can not ban Bitcoin, all they can do is to look for ways to shade it.
The implications can only affect one when they have too much of them holdings in Binance and Coinbase. They're the leading exchnages in the world and in the states, so it'll have huge implications more like th FTx or more than that.

Its not really about causing fear and stuff in the Crypto Currency space but please remove your holdings from exchnages. To those that might have heard and still fvcks around with exchnages.

[glendall]

cannot explain in detail and accurately, just see what will happen to the next crypto,
and most importantly withdrawing funds from both exchanges to personal wallet is my initial action

and I will stay tuned to this thread for a brief update of this case

[franky1]

in short
authorities always have the premiss "ignorance of the law is not a defence"
so they can set up policies and laws in secret(unpublicised) and even in just draft form and expect the world to comply immediately..
(yellen used to do this a couple years ago.. now gensler is trying the trick)

which they can then take those evading their policies to court to then prove an evasion due to another trick of "innocent till proven guilty" whereby the authorities can claim something suspect is happening and then let the courts prove it. meaning the authorities dont need to prove guilt upfront, nor only chase proven guilty offenders.
they can make suspect claims without guilty proof and then try to get the courts to prove guilt later

this is how authorities get to turn draft policy into precedented law. if they win then it becomes binding and they can then use that win to then be reference for future claims to make their policy be treated as law and easier to then chase more people evading a policy that was not(at this point) set in stone as law.
(its a way to get around needing a vote from congress/senate)

...

other things to note.
(a) if the SEC wins. its not just about requiring international companies requiring to register in the US. its also about setting precedent to allow the SEC to gain a power in law to seize international funds.. calling it "repatriating funds".. plus other powers the SEC currently does not have.. but wants to gain(if they win)

(b) part of this plan the SEC is orchestrating is setting up barriers of entry to make it exceedingly expensive for international companies to serve americans. this is becasue if/when licenced. the international company has to fund US compliance officers and auditors. which ends up as more expensive than a US domestic company. the game is to either make US domestic businesses have the beneficial edge to succeed.. and to get international companies to set up a HQ in america so that the authorities can then tax the international company
all of this is part of the "us friendly crypto"
its not make US friendly to international cryptocurrency. its make US crypto currency laws only friendly to the US businesses in the hopes that crypto businesses move to america to be friendly
(coinbase threatened to leave the US so the US is fighting back that option to make it a bad idea to leave the US)

[Crypt0Gore]

SEC saw nothing on CZ, some people believe that CZ is corrupt but that's not the case, with they way this is going, SEC wants something from crypto, some kind of settlement and agreement, it's always about the money, they don't enjoy watching people like Brain and Zhao getting all the crypto goodies, it's pure jealous and envy, where are these people when crypto was nothing?  

All I can say is, if SEC really want to put an end to crypto, Bitcoin should be the main target, why didn't they go after Bitcoin? This is very laughable, Bitcoin seem unstoppable for them I guess, because there is no one to sue, hahaha, I am not worried, not at all, because this whole war will make Bitcoin even more bullish, lets wait and see what happens next.

[Ayers]

No one can answer it, because it's full of speculation and conspiracy, we can only make a guess.

No one know what SEC is trying to get in this case and as you know human is really hard to understand.

SEC is just crackdown on Binance, that's.

What anyone should do is move their money to a non custodial wallet and try to learn to use a decentralized exchange or P2P sites to make sure you're invulnerable against of centralization.

If the SEC simply wanted to crackdown on Binance or Coinbase, it wouldn't be too complicated. But have you thought about why they chose the 2 biggest exchanges to sue and if this will stop when the top 2 companies in the crypto space fail? What I'm seeing is that the SEC wants all of this market, they want to control everything, not just suppress the two biggest exchanges. The lawsuit between the SEC and XRP is ending, and they may already have an outcome before us. In my opinion, the results are going in favor of the SEC, and they are motivated to attack us more.
What will happen to us if Binance and Coinbase continue to lose the lawsuit? If they can conquer centralized exchanges, then most likely, decentralized exchanges are the SEC's next target.

[tjtonmoy]

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?

Binance has two different platforms. One is called Binance.com and the other is Binnace.US. The Binance.com is used for global usage and the Binance.US is specifically created for the people is USA. There are some rules and regulations Binance has to follow in order to keep that running in the USA. Binance is told to give a personal wallet to every user of Binance.US. Also, any transaction between Binance.com and Binance.US is prohibited. But CZ let many users of the USA to trade in Binance.com
That is what I heard from the news. Source

• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?

Most likely yes. Because they are trying to dominate cryptocurrency for a while now. It will not be a surprise to see that they will do such thing. If the world's most famous exchange face this kind of this, it will obviously have an effect on the whole market. Not to mention that a huge amount of people's assets are in Binance. So if anyone is using Binance.US, it is recommended to move their assets in a private wallet.

• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?

I don't think, if the rules and regulations are followed correctly, they will try to push out Binance from the USA. Also, it's all about BInance.us. I have no idea how much it will affect the global users. It will have an effect but the amount of the impact is unknown. And as this is only about Binance.US, I don't think USA can convince their allied countries.

• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?

It will hurt everything. But that will be temporary. Binance will lose a huge amount of users. Many will convert their hodlings to fiat out of fear. That will hurt the market and about the USA. Yes, they will get hurt too, but they will understand that in the long run. Bitcoin is a technology. And if one country is left out from a piece of technology, they will find it so hard to regain that and implement that in their system. History tells the tale. The only thing will be left to them is regret.

• What message is the SEC trying to convey to other nations, especially their allies?

I have no idea what they are trying to do. But as this is about Binance.US I don't think it will have a major impact to other countries.

[348Judah]

• What does the SEC really want? Do they want to shut down Binance US and Bitcoin?

The government can shut down an exchange but they can't shutdown bitcoin because all bitcoin are not on exchanges neither are they on Binance, bitcoin is a digital decentralized currency, the government are taking it hard on exchanges because they can't attack bitcoin and rhey are using exchanges as their next target, bitcoin miners had suffered same challenges with them in the past before they begin to source for alternative energy source aside the ones from government end, so if Binance is affected, bitcoin cannot and such doesn't have impact on the market price.

• What would happen if CZ doesn't show up and a judgment is passed? Would they arrest CZ and use him as an example?

Everything will result on political power, if CZ knows his way forward he will always win against them, if he misses the appointment, he can also tind a means to double cross them through his influence and political tentacles he had with some of them the government officials.

• Does the SEC want to push Binance out of the US and convince their allied countries to do the same?

If that's their plan then Binance can always get welcomed to El-Savador and many other bitcoin fare regulatory policies countries for its business running.

• What are the implications of Binance leaving the US? Will it hurt Binance more, Bitcoin, or the US?

No much negative impact because Binance is a global exchange and US is not the only location they are situated, bitcoin is not affected, some US citizens may be affected because they rely and depends on Binance as source of income

• What message is the SEC trying to convey to other nations, especially their allies?

They can make thier own decisions as long as it's what favour them, everyone is independent on its own, if they also sees the need to follow the same pattern, that has nothing to do with affecting bitcoin and even the exchange as long as they maintain operations.