The largest crypto exchange by trading volume, Binance, announced in the official announcement suspension on Monday that its US subsidiary would delete Flexa’s AMP token “out of an abundance of caution”. And that move will take effect on August 15 as the platform awaits regulatory clarity.
Since Binance US made the announcement, AMP has been dropping in value. At the time of writing, AMP is down almost 10% in the last 24 hours, while it is down 93% from its all-time high in June 2021. The token is currently trading at $0.0082. Its total capitalization has now reached 358 million dollars.
Last month, in a lawsuit against the former Coinbase employee and his two alleged accomplices, the US Securities and Exchange Commission (SEC) classified nine tokens as securities, and AMP is one of them. Thus, to prevent any legal dispute with the US authorities, Binance US decided to remove the token. Notably, it is the only one removed from the platform.
According to the implied rules in the state, functional security elements need higher protection for users. This is why exchanges promoting these assets could be forced to register with the SEC.
While commenting on the SEC investigation with Coinbase, crypto exchange Binance added in a blog post:
We operate in a rapidly evolving industry and our listing and delisting processes are designed to respond to market and regulatory developments. Out of an abundance of caution, we have decided to delist the AMP token from Binance.US, effective August 15, 2022.
Binance Removes AMP Voluntarily to Compel SEC
In addition, Binance added that meeting regulatory requirements is the platform’s first priority to make investors participate with confidence. However, he further stressed that it remains to be seen how the authorities deal with AMP. Trading of the token can be repeated in the future at any time.
Notably, AMP will not only be available on Binance’s US subsidiary, users can trade AMP on other platforms.
On the other hand, Coinbase has disputed the SEC’s allegations of trading in unregistered securities. Paul Grewal, the company’s chief legal officer, said in response to the SEC’s investigation;
We are confident that our rigorous due diligence process—one that the SEC has already reviewed—keeps securities off our platform, and we look forward to working with the SEC on this matter.
AMP is the native token of the Amp blockchain designed to secure and consolidate cryptocurrency transfers by acting as a collateralized token. Widely used on Bitcoin and Ethereum networks, Amp provides AMP tokens to users that are liquidated whenever a transaction takes too long or becomes unsuccessful.
Featured image from Pixabay and chart from TradingView.com