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and Binance Coin (BNB) are likely picks for SEC lawsuit Legal expert says Tether and Binance Coin (BNB) are likely picks for SEC lawsuit Samuel Wan * 1 day ago * 2 min read Community reacts after Dfinity token ICP loses 80% of its value since MayCommunity reacts after Dfinity token ICP loses 80% of its value since May Community reacts after Dfinity token ICP loses 80% of its value since May Oluwapelumi Adejumo * 5 days ago * 2 min read Banks won't exist in ten years unless they change their business modelBanks won't exist in ten years unless they change their business model Banks won't exist in ten years unless they change their business model Branden Hampton * 4 days ago * 2 min read Thai SEC orders exchanges to delist Dogecoin, Shiba Inu, NFTs, and 'fan' tokensThai SEC orders exchanges to delist Dogecoin, Shiba Inu, NFTs, and 'fan' tokens Thai SEC orders exchanges to delist Dogecoin, Shiba Inu, NFTs, and 'fan' tokens Shaurya Malwa * 2 days ago * 2 min read $500 million asset manager 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Join Now Tether > U.S. > Legal Legal expert says Tether and Binance Coin (BNB) are likely picks for SEC lawsuit USDT and BNB fall under the securities spotlight, a top lawyer says. Samuel Wan * June 15, 2021 at 11:00 pm UTC * 2 min read Legal expert says Tether and Binance Coin (BNB) are likely picks for SEC lawsuitLegal expert says Tether and Binance Coin (BNB) are likely picks for SEC lawsuit Samuel Wan Contributor @ CryptoSlate Info Twitter Share Tweet Post Share Post Email Attorney Jeremy Hogan gave his legal assessment of the top five cryptocurrencies naming Tether and Binance Coin as at risk on the "SEC danger rating." Hogan has been covering the SEC vs. Ripple lawsuit since proceedings began in December last year. The U.S securities regulator alleges Ripple had sold $1.3 billion of unregistered securities over eight years. The coverage has demonstrated his knowledge of the complex legal subtleties involved with securities law. Based on the analysis, Hogan warns that, in his opinion, both Tether and BNB are likely candidates for legal action. Criteria for SEC enforcement In determining a breach of securities law, the SEC has relied upon the Howey test to evaluate whether a transaction qualifies as an "investment contract." "Under the Howey Test, an investment contract exists if there is an "investment of money in a common enterprise with a reasonable expectation of profits to be derived from the efforts of others," he said. The Howey Test refers to SEC vs. W.J. Howey, which the Supreme Court preceded over in 1946. The Howey company had sold zones of citrus groves to buyers in Florida, who then leased back the land to Howey. Howey staff tended to the groves and sold the fruit on behalf of the owners, with both parties taking a share in the revenue generated by the operation. Howey did not register the transactions with the SEC, and the Supreme Court's final ruling determined that the leaseback deal qualified as an investment contract. The criteria used to establish an investment contract was: 1. An investment of money. 2. In a common enterprise. 3. The expectation of profit. 4. Profit to be derived from the effort of others. What did Hogan say about Tether and BNB? Hogan pointed out that his assessment was not a determination of whether the tokens would win or lose in a securities lawsuit. Instead, it relates to the chances of SEC bringing legal action in his opinion. Hogan touched briefly on Tether's $18.5 million settlement in February this year with the New York Attorney General (NYAG). Parent company Bitfinex paid the fine to end the probe into allegations it had tried to cover up an $850 million loss. The NYAG also raised concerns over allegations it had a shortfall of cash reserves backing the Tether in circulation. Hogan didn't discuss how Tether stacked up against the Howey test criteria but gave the popular stablecoin a 9/10 danger rating. In breaking down BNB's situation, Hogan points out that BNB tokens do form an "investment of money." He added that the Binance ICO in 2017 also matches the description of an investment contract. "Is there investment of money? Yes, you buy the coins. And where did the coins come from? Well, Binance had a genuine Initial Coin Offering, an ICO, in 2017. This is the exact thing that Chairman Clayton and new SEC Chairman Gensler have basically said is an investment contract." What's more, Hogan said Binance's operations are very centralized, citing the firm's buyback coin burn policy, which keeps coins scarce therefore increasing their value, as fitting the narrative of the expectation of profit. He gave BNB an SEC danger rating of 8.5/10. Get an edge on the cryptoasset market Access more crypto insights and context in every article as a paid member of CryptoSlate Edge. On-chain analysis Price snapshots More context Join now for $19/month Explore all benefits Posted In: Tether, U.S., Legal, Opinion, People Like what you see? Subscribe for updates. You might also enjoy... 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Join now for $19/month Explore all benefits Edge Exclusive Bitcoin options shows 30% chance of BTC trading above $50,000 next monthBitcoin options shows 30% chance of BTC trading above $50,000 next month Bitcoin options shows 30% chance of BTC trading above $50,000 next month Options data suggest Bitcoin has a small chance to trade above the $50,000 price level at the end of next month, data from multiple sources shows. Shaurya Malwa * 21 hours ago * 3 min read Bitcoin ranges in the high $30,000s--but technicals suggest there's 'red' aheadBitcoin ranges in the high $30,000s--but technicals suggest there's 'red' ahead Bitcoin ranges in the high $30,000s--but technicals suggest there's 'red' ahead Bitcoin and Ethereum both continue to show an unclear direction as both fail to break major resistances and fall back on their 'support' price levels. Rohan Jethi * 3 days ago * 2 min read Despite the fear, this on-chain proponent expects EOY Bitcoin price of $300,000Despite the fear, this on-chain proponent expects EOY Bitcoin price of $300,000 Despite the fear, this on-chain proponent expects EOY Bitcoin price of $300,000 It's coming up to two months since Bitcoin peaked at $65,000. Samuel Wan * 5 days ago * 2 min read SwissBorg's Anthony Lesoismier shares investing gems for crypto investorsSwissBorg's Anthony Lesoismier shares investing gems for crypto investors Video SwissBorg's Anthony Lesoismier shares investing gems for crypto investors Over 90% of all hopeful crypto traders end up losing money when trying their luck in the market, and usually end up losing their capital (or, worst, in debt) while trying to print millions instead. Shaurya Malwa * 3 hours ago * 2 min read The human factor in trading is obsolete -- blockchain and Artificial Intelligence are coming to the foldThe human factor in trading is obsolete -- blockchain and Artificial Intelligence are coming to the fold Press Release The human factor in trading is obsolete -- blockchain and Artificial Intelligence are coming to the fold In 2020, more than 90% of trading on the Forex market was performed by machines and algorithms. Get an edge on the market Join now Got a story tip? 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