News View Non-AMP

Ex-SEC Lawyer Raises Red Flag, Urges Crypto Investors To Exit Markets! Here’s Why.

Published by
Qadir AK

Binance, one of the largest cryptocurrency exchanges in the world, has halted withdrawals citing network congestion. This news comes on the heels of an unconfirmed report that the halt occurred right after $3.3 billion bitcoin in aggregated account withdrawals from multiple exchanges. This was addressed in a tweet by John Reed, Former Chief, of the SEC Office of Internet Enforcement.

Lack of Regulatory oversight is a bigger problem

Reed pointed out that the current crypto industry is highly unregulated. Binance is not registered with the SEC, which means that there is no US oversight, audits, inspections, net capital requirements, licensure, or insurance.

If Binance was SEC or FDIC registered, a US team of auditors would be on site and in Binance’s face, demanding to speak to everyone, demanding documents, demanding trading information, and immediately investigating, and referring any suspicious conduct to the US DOJ. But as the crypto industry is highly unregulated, this is unlikely to happen, which makes the investors insecure. 

Lack Of Consumer Protection

The broader issue in the crypto-ecosystem is that there is a lack of consumer and investor protections. When a halt or suspension occurs, customers are left holding their breath and praying. Victims of crypto-collapses become unsecured creditors, likely left with nothing.

When a halt, suspension, etc. occurs, customers just hold their breath and pray. Consider all of the victims from the collapses of FTX, Celsius, BlockFi, Voyager, Terra and all the rest — who lost everything after a “halt.”

Should You Exit The Markets?

The risks associated with the lack of regulatory oversight are never justified under any circumstance, according to Reed. He urges all Binance and other crypto platform customers to get out now.

Related: Coinbase Challenges SEC: Is This the Beginning of the End for US Crypto Regulations? – Coinpedia Fintech News

What the crypto industry lacks is no industry oversight, licensure, insurance, etc. This can become scary when a ‘withdrawal halt’ like this happens. Moreover, this is a nightmare for regulators who are worried about fraud, money laundering, and other criminal activities. 

The question remains: how long can the crypto-ecosystem continue to operate without proper regulation and oversight? As the industry grows and matures, the need for regulatory clarity and protections for consumers and investors will become increasingly urgent.

Qadir AK

Qadir Ak is the founder of Coinpedia. He has over a decade of experience writing about technology and has been covering the blockchain and cryptocurrency space since 2010. He has also interviewed a few prominent experts within the cryptocurrency space.

Recent Posts

Where to Buy Influencer Pepe Before It Hits Major Exchanges!

A new meme coin that is gaining significant attention in the cryptocurrency market is Influencer…

March 31, 2025

Bitcoin (BTC) Drops Toward Range Lows While Whales Accumulate a New Token Priced at $0.025

While Bitcoin hovers near its recent range lows, a quiet shift is taking place in…

March 31, 2025

Dogecoin is Facing Rising Bearish Threat as It Drops Toward $0.16: Will Buyers Bounce Back?

Dogecoin has experienced a significant decline in the past few hours, facing a sharp selloff…

March 31, 2025

ICB Labs Expands Global Presence with Strategic Partnerships, Staking Opportunities, and Upcoming DEX Launch

ICB Labs continues its global expansion, strengthening its blockchain ecosystem through strategic collaborations, enhanced staking…

March 31, 2025

Best Crypto to Invest in if You Want Become A Crypto Whale: Top 3 Crypto Investments of 2025

Are you a crypto newbie who wants to become a crypto whale? If so, you've…

March 31, 2025

Remittix Raises Over $14 Million in Record Time as Presale Is Predicted to Be the Best of 2025

The crypto landscape has been stunned by the rapid success of Remittix which obtained over…

March 31, 2025