Former SEC Chair Gensler Accused of Offering Advisory Services to Binance, Lawyers Claim
In a recent development, lawyers representing Binance and its founder Changpeng Zhao have alleged that Gary Gensler, the former Chair of the United States Securities and Exchange Commission (SEC), had offered to serve as an advisor to the cryptocurrency exchange. These claims shed light on a potential connection between Gensler and Binance dating back to 2019.
Documents filed by the SEC on June 7, as reported by CNBC, revealed that attorneys from Gibson & Dunn and Latham & Watkins made the allegation that Gensler had extended an offer to serve as an advisor to Binance in March 2019. However, a previous report by The Wall Street Journal had stated that it was Binance who initially approached Gensler in 2018 for the advisory role.
According to The Wall Street Journal, which cited messages and documents from 2018 to 2020, the meeting between Gensler and Binance representatives took place in October 2018. Ella Zhang, the former head of Binance’s venture investing arm, and Harry Zhou, co-founder of Binance-invested firm Koi Trading, presented Gensler with an advisory position, which he declined at a later stage.
The report also highlighted that several private companies had approached Gensler during his tenure as a professor at MIT, offering advisory positions. However, Gensler reportedly declined all such offers.
Gensler’s Background Sets the Stage for Binance Showdown
Gary Gensler, who assumed the role of SEC Chair in April 2021 after being nominated by President Joe Biden, had previously served as a professor of the practice of global economics and management at the MIT Sloan School of Management. He had also chaired the Maryland Financial Consumer Protection Commission from 2017 to 2019.
The recent legal allegations against Binance arose from the SEC’s lawsuit filed on June 5. The regulatory agency accused the cryptocurrency exchange of operating illegally in the United States and failing to register as a securities exchange. The SEC pressed a total of 13 charges against Binance, including allegations of unregistered token sales and its staking program.
Binance Stands Tall Amidst Regulatory Storm
In response to the regulatory actions, Binance released a statement through its Chinese social media channels on June 7, asserting its distinctive approach compared to other crypto exchanges. Binance emphasized the transparency of its wallet addresses and denied any misappropriation of customer funds. Furthermore, the exchange claimed to have refrained from making substantial donations to political candidates or engaging in large sponsorships, seemingly drawing a contrast with the now-defunct FTX exchange.
Notably, Binance’s CEO, Changpeng Zhao, took to Twitter to question the SEC’s handling of the situation, pointing out that the agency had not taken legal action against FTX, despite Gensler drawing parallels between the two companies in an interview.
Cointelegraph reached out to the SEC for comment but did not receive an immediate response. The unfolding legal proceedings and the allegations surrounding Gensler’s alleged offer of advisory services to Binance further contribute to the ongoing scrutiny of the cryptocurrency industry and its regulatory landscape.
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