Binance.US Delists Tron's TRX Token Amidst SEC Lawsuit Alleging Securities Violation Concerns

Binance.US has delisted Tron's TRX token, citing changes in industry circumstances and its own high standards. The move comes after the SEC accused Tron founder Justin Sun of unregistered securities sales and market manipulation involving TRX. TRX's price dropped by 6.4% following the news, and trading will cease on Binance.US on April 18th. Tron has confirmed communication with Binance.US regarding the delisting but declined further comment.

Binance.US Delists Tron's TRX Token Amidst Regulatory Concerns

Binance.US, the American affiliate of Binance, has announced its decision to delist Tron's native cryptocurrency, TRX, effective April 18, 2023. This move follows recent legal developments involving Tron founder Justin Sun and allegations of securities violations related to the TRX token.

On February 21, 2023, the U.S. Securities and Exchange Commission (SEC) filed a lawsuit against Sun, alleging that he sold and airdropped unregistered securities, engaged in fraud, and manipulated the TRX market. The SEC further asserted that TRX, which has a market capitalization exceeding $5.5 billion, was offered and sold as an investment contract, meeting the definition of a security under U.S. law.

Upon the news of the SEC's lawsuit, the value of TRX plummeted by approximately 6.4%, according to data from CoinDesk. Binance.US cited this market volatility and the ongoing regulatory scrutiny as reasons for its decision to delist TRX.

In a statement, Binance.US emphasized its commitment to "high standards" and its willingness to respond swiftly to "market and regulatory developments." The exchange further noted that it conducts thorough reviews of affected assets when they fall below its standards or when external circumstances necessitate further action.

A spokesperson for Tron indicated that the company is currently in communication with Binance.US regarding the delisting but declined to provide any further comment at this time.

The delisting of TRX by Binance.US is a significant event in the cryptocurrency industry and raises concerns about the potential regulatory risks associated with decentralized finance (DeFi) projects. As regulatory bodies around the world increase their scrutiny of digital assets, DeFi platforms and their native tokens face heightened legal challenges.

The outcome of the SEC's lawsuit against Sun and Tron will be closely watched by the industry, as it has the potential to set important legal precedents regarding the classification and regulation of cryptocurrencies.