Binance, one of the world's largest cryptocurrency exchanges, and its CEO, Changpeng Zhao, are facing a lawsuit filed by the Commodity Futures Trading Commission (CFTC) over alleged regulatory violations.
According to a Bloomberg report, the lawsuit was filed in federal court in Chicago on Monday, accusing Binance and Zhao of breaking trading and derivatives rules.
The news of the lawsuit has sent shockwaves through the cryptocurrency market, with the price of Bitcoin plunging to $26,766, a 4.4% drop for the day.
Binance's native cryptocurrency, Binance Coin (BNB), has also been affected, with its value dropping by 1.6%.
This latest development adds to the growing list of regulatory challenges faced by Binance. The exchange has previously come under scrutiny by authorities in multiple jurisdictions, including the United States and the United Kingdom.
The case highlights the increasing importance of regulatory compliance for cryptocurrency exchanges and the need for clearer guidelines to navigate the evolving digital asset landscape.