Investing.com -- Binance said Monday the Securities and Exchange Commissions lawsuit against the company for allegedly violating multiple securities law in the United States was "limited in reach" as the cryptocurrency trading platform isn't a registered U.S. exchange.
BNB Index fell more than 8%.
"Because Binance is not a U.S. exchange, the SEC’s actions are limited in reach," Binance said in a blog post Monday, replying to a lawsuit filed by the securities regulator.
The SEC accused Binance of misleading investors and regulators as well as misusing customer funds in a case filed in federal court on Monday.
“We allege that Zhao and the Binance entities not only knew the rules of the road, but they also consciously chose to evade them and put their customers and investors at risk,” said Gurbir S. Grewal, director of the S.E.C.’s enforcement division.
Following the news, customers raced to pull nearly $70 million in funds from the platform, according to blockchain intelligence platform Nansen.
The crypto firm pledged to continue to work with regulators and policymakers in the U.S., but added that it was prepared to fight the allegations "to the full extent of the law." The allegations are "just another example of...misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry," it added.
Binance also said user assets on its platforms, including Binance.US, were "safe and secure," and insisted it would vigorously defend against any allegations to the contrary.
The news of further regulatory action in the industry, pushed Bitcoin (BitfinexUSD), ETH/USD, and other cryptos sharply lower.