BNB and CAKE prices drop after Binance faces SEC enforcement.

The prices of two major tokens within the Binance ecosystem, Binance Coin (BNB) and PancakeSwap (CAKE), have dropped significantly in the four hours following a lawsuit filed against the centralized exchange by the Securities and Exchange Commission (SEC). According to data from blockchain analytics firm Cryptowatch, BNB, which has a total market dominance of 3.86% according to CoinGecko, has fallen more than 8% from $300 to $276 in the past four hours, while CAKE has dropped roughly 9% from $1.70 to $1.54.

The recent declines in BNB and CAKE prices follow allegations made by the SEC that Binance commingled customer funds and operated as an unregistered securities exchange. In response, Binance has stated that BNB coin is not a security, but rather a native token designed to create an internal economy where its value derives from its participants.

CAKE, the token that powers PancakeSwap, the BNB Chain alternative to decentralized exchanges like Uniswap and SushiSwap, is used for liquidity mining rewards and grants holders governance rights over the protocol. The total value locked on Pancake Swap stands at $1.81 billion, a roughly 9% decrease in the past seven days according to DeFi Llama.

Read More: Cryptocurrencies Crash After the SEC Charges Binance With Sale of Unregistered Securities

Read More: Binance Withdrawal On Track to be Largest Since March Crypto Banking Crisis

This article has been edited by James Rubin.

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