Category Archives: Binance
XRP News Today: Ripple References the Binance Ruling in New Court Filing – FX Empire
The lack of regulatory clarity prior to that ruling in turn supports Ripples position that the Courts finding of a strict liability violation on some of Ripples sales but far fewer than the SEC alleged were violations does not reflect reckless disregard for the law or warrant harsh remedies. And, of course, the SEC did not even allege recklessness as to Ripple in its Complaint.
The SEC vs. Ripple case is in its final stages. Investors await a court verdict for Ripple breaching US securities laws for selling XRP to institutional investors.
In March 2024, the SEC filed its remedies-related opening brief. The SEC pursued an almost $2 billion penalty and an injunction prohibiting XRP sales to US institutional investors.
Ripple countered the SEC opening brief. In its remedies-related opposition brief, Ripple argued for a $10 million penalty, stating that it did not continue breaching US securities laws after the complaint. Ripple also pointed out that there were no allegations of fraud or recklessness.
The SEC will likely file a response to the Supplemental Notice of Authority. How the SEC argues against the Binance ruling would likely draw plenty of interest.
Will the SEC hint at an appeal against the Binance ruling?
The SEC may reference the SEC vs. Terraform Labs ruling. Judge Rakoff ruled that Terraform Labs and its founder, Do Kwon, violated US securities laws by failing to register TerraUSD and Luna as securities. Significantly, Judge Rakoff also referenced the Programmatic Sales of XRP ruling, opining that Judge Torres made an error in her ruling.
For context, Judge Amy Berman Jackman rejected SEC allegations that secondary market transactions of Binances BNB token meet the criteria for securities under the Howey test.
Judge Jackman also referenced the Programmatic Sales of XRP ruling, surmising,
The court is inclined to agree with the approach of the court in Ripple Labs, since the it-is-what-it-is approach of the SEC appears to be inconsistent with the clear Supreme Court directives [].
Meanwhile, the Binance ruling may also end SEC plans to appeal against the Programmatic Sales of XRP ruling. However, the courts view on the Binance ruling and the SEC vs. Ripple case verdict could be pivotal.
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XRP News Today: Ripple References the Binance Ruling in New Court Filing - FX Empire
XRP Case Update: Ripple New Filing Highlights Binance Ruling to Advocate Against Harsh Penalties – The Crypto Basic
Leading crypto payments company Ripple submits a supplemental authority in its ongoing lawsuit with the U.S. Securities and Exchange Commission (SEC).
The new filing relates to the latest court decision in the SEC v. Binance lawsuit, in which the court denied and granted in part the exchanges motion to dismiss the SECs charges that certain digital asset sales constitute investment contracts.
The payments company pointed out that the Binance judge followed the summary judgment reasoning in the SEC v. Ripple case, applying the decision to the secondary market sales of BNB, one of the assets at issue.
Additionally, Ripple argued that the Binance judge recognized the challenges in applying traditional securities laws to intangible digital assets.
The court observed that the SECs approach of litigating the industry through individual litigations instead of clear regulations is inefficient.
Ripple contends that the lack of regulatory clarity observed by the Binance judge further supports its position that its actions do not warrant harsh remedies.
Following Ripples supplemental authority regarding the Binance ruling, the SEC is expected to file its opposition in the coming days.
It bears mentioning that Ripples recent brief aims to support the companys opposition to the SECs pending motion for remedies.
Recall that the SEC requested a nearly $1.95 billion fine as a potential penalty for Ripples securities law violations. The regulator also asked the court to impose a permanent injunction on Ripples institutional sales of XRP. In response, Ripple argued that an injunction is unwarranted, pushing for a penalty of not more than $10 million.
Meanwhile, this is the second time Ripple has submitted a supplemental authority in the remedies litigation. Last month, the crypto payments company cited the SEC v. Terra settlement to justify its pleading for a reduced penalty.
After the SEC responds to Ripples latest final, the court will determine the timing of the final judgment. Notably, the final verdict could be issued at any time, with top stakeholders expecting the decision this year.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basics opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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Ripple Files Notice to SEC in Wake of Recent Binance Ruling – DailyCoin
San Francisco-based blockchain company Ripple is pushing for clearer regulatory guidelines for cryptocurrencies following a recent court decision in an unrelated case. The move comes amid Ripples ongoing legal battle with the U.S. Securities and Exchange Commission (SEC) regarding the classification of XRP, Ripples native token.
The crux of the issue lies in a June 28 ruling by the U.S. District Court for the District of Columbia. The court partially sided with cryptocurrency exchange Binance, dismissing the SECs claims that certain digital asset sales constituted unregistered securities offerings. This decision, according to Ripple, hinges on the July 2023 summary judgment in the SEC vs Ripple Labs case.
In that case, Judge Analisa Torres differentiated between secondary market sales where investors trade amongst themselves and direct institutional sales by Ripple itself. Notably, the court ruled that XRP, as a tradable token, didnt qualify as a security in the secondary market.
However, the court left the door open for the SEC to pursue Ripple for its direct sales to institutions. This distinction between sale methods aligns with the Binance ruling, where Judge Amy Berman Jackson cited the Ripple case as precedent.
This, according to Ripple, underscores the critical need for clear regulations that distinguish between different types of cryptocurrency transactions. Ripple further emphasizes a point raised by the court: the current SEC approach of relying on litigation to regulate the industry creates uncertainty for both companies and investors.
The lack of clear guidelines makes it difficult to determine whether specific actions violate securities laws. Ripple argues that this very uncertainty weakens the SECs claim that they knowingly disregarded regulations with their XRP sales.
The implication here is that the SECs request for hefty fines exceeding $2 billion might be excessive in light of the unclear regulatory landscape. Currently, Ripple is locked in a separate dispute with the SEC concerning the appropriate remedies in the case.
The outcome of these legal battles will have significant implications for the entire cryptocurrency industry. Clearer regulations will not only provide much-needed guidance for companies like Ripple but also foster a more stable environment for investors navigating the ever-evolving digital asset market.
This back-and-forth between Ripple and the SEC highlights the urgent need for concrete regulations that differentiate between security-like token offerings and utility tokens used for facilitating transactions. Such clarity would establish a fairer legal ground for companies and create a more predictable environment for investors to navigate the crypto space.
If youre interested in the legal landscape surrounding cryptocurrency, check out this article on the recent SEC lawsuit win against Binance: Ripple and SEC Final Arguments Heard, What Comes Next?
Continuing the conversation on cryptocurrency regulations, this article dives into the ongoing Ripple vs. SEC case and the recent final arguments: SEC Wins Key Claims in Lawsuit Against Binance: What Now?
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Ripple Files Notice to SEC in Wake of Recent Binance Ruling - DailyCoin
Coinbase References Binance Token Case in Petition to SEC – Coinfomania
In a legal battle that has captured the attention of the cryptocurrency industry, Coinbase is leveraging a significant judicial ruling to strengthen its position against the U.S. Securities and Exchange Commission (SEC).
The ruling in question came from Judge Amy Berman Jackson in the case of SEC v. Binance, where it was determined that secondary sales of Binances BNB token do not qualify as securities transactions under the guidelines of the Howey test.
This decision has provided Coinbase with a judicial precedent to challenge the SECs current regulatory approach. The confrontation escalated when Coinbase accused the SEC of inconsistent and arbitrary rule-making.
In a strongly worded letter from their attorneys, Coinbase criticized the SEC for not having a clear and coherent explanation of its regulatory procedures, accusing the agency of attempting to enforce these rules retroactively on the digital asset industry through aggressive legal actions.
The tension between Coinbase and federal agencies intensified with Coinbase filing a lawsuit on June 27 against the SEC and the Federal Deposit Trust Corporation. The lawsuit alleges that these agencies conspired to exclude the crypto industry from the banking sector.
It further accuses them of violating the Freedom of Information Act by failing to provide necessary documentation on rulemaking deliberations, particularly concerning Ethereums transition to a staking-based digital asset ecosystem.
This legal challenge is not the first instance where the SECs classification of digital assets has been contested. Back in 2018, the SECs then Corporation Finance Director William Hinman stated that Ethereums cryptocurrency, ETH, was not a security, citing its decentralized smart contract protocol.
This statement later played a crucial role in Ripple Labs defense against the SECs charges that Ripples XRP token was an unregistered security. Ripple Labs argued that the SEC lacked consistent criteria for defining what constitutes a securities contract.
The inconsistencies in the SECs approach have not gone unnoticed within the agency itself. SEC Commissioner Mark Uyeda has openly criticized the SECs problematic dealings with the crypto sector, reflecting internal disagreements over the agencys strategy.
The legal landscape was further complicated by another ruling from Judge Analisa Torres in the case of SEC v. Ripple Labs.
Judge Torres established that while secondary sales of XRP did not constitute the sale of unregistered securities, initial sales to institutional investors did, based on the nature of the transactions rather than the characteristics of the digital asset itself.
Amidst these legal entanglements, the political and regulatory environment for cryptocurrencies in the U.S. is showing signs of change.
Crypto venture capitalists have noted a shift in political attitudes towards the industry, which was evident when spot Ether exchange-traded funds received rapid approval in May. This approval significantly boosted market confidence, demonstrating a more accommodating regulatory stance.
The legislative response has also been noteworthy. The House of Representatives passed the 21st Century Act (FIT21) with bipartisan support in May.
This act aims to clarify the role of government agencies in regulating digital assets, addressing a persistent demand from the cryptocurrency sector for clearer guidelines.
Despite these positive developments, challenges remain. Cosmo Jiang, managing partner at Pantera Capital, has observed a trend of blockchain entrepreneurs relocating overseas due to the uncertain regulatory environment in the U.S. Jiang expressed concern over the loss of a generation of talented entrepreneurs who have moved their operations to more crypto-friendly jurisdictions.
The recent SEC complaint against Consensys, the parent company of the MetaMask wallet, further highlights the regulatory challenges facing the industry.
Filed on June 28, the complaint accuses Consensys of operating as an unregistered broker and engaging in the sale of unregistered securities since 2020. Consensys has countered by arguing that the SEC lacks the authority to regulate software interfaces like MetaMask.
As the political climate surrounding cryptocurrencies continues to evolve, industry stakeholders remain cautious. Carlos Pereira, a partner at Bitkraft Ventures, pointed out the varied reactions from political campaigns to the growing popularity of cryptocurrencies.
He noted that the outcomes of the upcoming November presidential election could significantly impact the industry, with different administrations potentially adopting divergent regulatory approaches.
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Coinbase References Binance Token Case in Petition to SEC - Coinfomania
Crypto: Ripple Partners with Binance to Counter the SEC! – Cointribune EN
Wed 03 Jul 2024 3 min of reading by Eddy S.
In a recent turn of events, Ripple leveraged a favorable court decision regarding Binance to bolster its defense in its lawsuit against the crypto regulator. On June 28, the United States District Court for the District of Columbia partially dismissed the SECs allegations, which claimed that the sales of certain cryptocurrencies were akin to securities sales. An opportunity that Ripple was quick to seize.
Ripple emphasized that the court had adopted the logic of Judge Analisa Torres decision in the case against the crypto regulator, dating back to July 13, 2023. Judge Amy Berman Jackson referenced this decision in the Binance case, distinguishing sales on the secondary market from institutional sales.
This decision follows comments from District Judge Jed Rakoff. He believes that the method of sale was not relevant to determine the legal status of cryptocurrencies. The court also criticized the SECs approach of regulating the crypto industry through litigation, failing to provide sufficient clarity to the concerned parties.
Ripple interpreted these observations as support for its argument that clarifying the legal status of cryptos is essential. The company also notified that this regulatory uncertainty shows that it did not act with a reckless disregard for the law during its XRP sales. Thus questioning the severity of the sanctions demanded by the SEC.
This case highlights the complexity and importance of regulation in the crypto field. As Ripple and other industry players strive to navigate a changing regulatory environment, court decisions like this one could influence the future of digital asset regulation. Investors and market participants must remain vigilant about these developments. They could affect not only ongoing legal cases but also the perception and adoption of crypto on a global scale.
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Crypto: Ripple Partners with Binance to Counter the SEC! - Cointribune EN
Binance exec trial will resume July 5 as family reports health problems – Cointelegraph
Prosecutors in Nigeria will move forward with a case brought by the countrys Economic and Financial Crimes Commission (EFCC) against Tigran Gambaryan, a Binance executive detained since February.
A spokesperson for the family told Cointelegraph that Gambaryans legal team began and ended its cross-examination of an EFCC witness on July 2. The government agency has filed money laundering charges against Gambaryan and Binance executive Nadeem Anjarwalla, who escaped custody in March and reportedly fled to Kenya.
Nigeria officials plan to resume Gambaryans trial on July 5. However, his family is reporting that his health has been deteriorating in the roughly 128 days since authorities detained him and Anjarwalla. According to the spokesperson, Gambaryan has had double pneumonia and malaria and reported aches and pains in his foot and back.
In a statement to Cointelegraph, Gambaryans wife, Yuki, said she was not in contact with anyone from the Nigerian government but had been speaking with officials in the U.S. State Department and U.S. Embassy in Abuja. She reported regular calls with Binance staff and the lawyers representing her husband in the EFCC case.
I thought the U.S. Government response was quite slow at first, especially considering that Tigran used to work for the U.S. Government, said Yuki. However, I believe they have noticeably increased their efforts and engagement recently [...] In my eyes, it is evident any issues between Binance and the Nigerian authorities can and should be resolved without Tigran being caught in the middle.
Nigeria authorities initially charged Gambaryan and Anjarwalla with tax evasion and money laundering charges in February after the pair traveled to the country as representatives of Binance. Anjarwalla escaped to Kenya in March and reportedly faces extradition back to Nigeria. In June, Nigerias Federal Inland Revenue Service dropped the tax evasion charges, but the money laundering case was ongoing at the time of publication.
Related: 108 ex-prosecutors, feds echo calls to rescue Binance exec in Nigeria
Many U.S. officials and people interested in the case have criticized Nigerian authorities for holding two executives who willingly traveled to the country accountable for the companys alleged actions. On June 20, U.S. Representatives French Hill and Chrissy Houlahan met Gambaryan in Kuje Prison in Nigeria, calling for authorities to drop the charges and release him immediately on humanitarian grounds.
Yuki Gambaryan launched a petition to bring her husband back to the U.S., which had 4,879 signatures at the time of publication roughly one hundred shy of its goal of 5,000. The results of the petition will presumably be forwarded to the U.S. State Department, President Joe Biden, the EFFCC, and the Nigerian government.
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Binance exec trial will resume July 5 as family reports health problems - Cointelegraph
Terra Classic Sees Major Supply Reduction as Binance Burns 1.7B LUNC – The Crypto Basic
The latest LUNC burn of 1.7 billion tokens from Binance significantly reduces the Terra Classic supply, aligning with increased trading volume.
Binance has completed another significant LUNC (Luna Classic) burn to start in July. The burn event led to a substantial decrease in the total LUNC supply, as highlighted by recent charts posted by community figure Rexyz.
The burn activity has garnered appreciation towards Binance founder and former CEO Changpeng Zhao, as well as current CEO Richard Teng.
The first image posted by Rexyz showcases the total LUNC supply over a 4-hour period. The supply stood at 6,781,807,335,479 LUNC, with a notable decrease of 1,726,507,904 LUNC in the latest candlestick.
This sharp drop within a short time frame indicates a significant burn event, likely involving a large transaction or a series of transactions that reduced the total supply.
The second image presents a broader view, covering the LUNC supply from March 2024 to June 2024. The total supply was recorded at 6,781,738,369,201 LUNC, with a decrease of 1,799,065,981 LUNC in the latest week.
On-chain data confirms that the latest burn, which involved exactly 1,701,046,397 (1.701 billion) LUNC, occurred on July 1 at 10:20 UTC.
The chart provided by Rexyz reveals a consistent decrease in supply over several months, with more pronounced drops towards the end of the period. This aligns with the recent burn event at the start of July, reflecting Binances ongoing efforts to reduce the LUNC supply through increased trading activity.
In addition to Binances burns, the Terra Luna Classic community has been proactive in reducing the LUNC supply. As the native LUNC coin faced challenges from the crypto bears since June, community developers proposed faster ways to decrease supply.
The Terra Classic Foundation recently announced the exclusion of over 12 billion LUNC and 68 million USTC from circulation through specific contracts. These contracts include Anchor bLuna Rewards and Lido Rewards Dispatcher, with funds locked since a Lido DAO proposal passed in June 2022.
Previously, the community voted on Proposal 12098, which aims to review the LUNC burn tax to fund the Oracle pool.
This proposal, initially suggested by StrathCole, seeks to modify the burn tax distribution. It proposed allocating 80% towards burning, 10% to the Community Pool, and 10% to the Oracle Pool, ensuring block rewards consist solely of gas fees.
Disclaimer: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basics opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
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Terra Classic Sees Major Supply Reduction as Binance Burns 1.7B LUNC - The Crypto Basic
Coinbase Builds On SEC V. Binance Ruling Momentum – FinanceFeeds
Coinbase is leveraging the momentum from Judge Amy Berman Jacksons ruling in the SEC v. Binance case. The judges decision established that secondary sales of Binances BNB token do not constitute securities sales under the Howey test criteria.
In a letter, Coinbases attorneys accused the SEC of arbitrary rule-making without a consistent framework. They stated that the SEC has never coherently explained its regulatory process and is attempting to impose it retroactively on the digital asset industry through aggressive enforcement actions.
On June 27, Coinbase filed a lawsuit against the SEC and the Federal Deposit Insurance Corporation (FDIC), alleging that both agencies conspired to exclude the crypto industry from the banking sector.
Coinbase argued that the federal agencies failed to comply with the Freedom of Information Act and did not provide necessary documentation related to their rule-making deliberations, particularly concerning Ethereums transition to a staking-secured digital asset ecosystem.
The SECs classification of Ether (ETH) has faced scrutiny before. In 2018, SEC Corporation Finance Director William Hinman stated that ETH was not a security due to its sufficient decentralization. This assertion later became a key point in Ripple Labs defense against the SECs classification of XRP as an unregistered security, arguing the regulator lacked consistent criteria for defining a securities contract.
SEC Commissioner Mark Uyeda has criticized the agencys handling of the crypto industry, calling it problematic.
Judge Jacksons ruling in the SEC v. Binance case reinforces the precedent set by Judge Analisa Torres in SEC v. Ripple Labs. Judge Torres ruled that secondary sales of XRP did not constitute sales of unregistered securities, as the digital asset did not meet the SECs criteria for an investment contract. However, initial sales of XRP to institutional investors were deemed securities sales due to the specific circumstances of those transactions, rather than the inherent characteristics of the token.
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Coinbase Builds On SEC V. Binance Ruling Momentum - FinanceFeeds
SEC Scores Partial Win in Binance Case: Key Fraud Charges Move Forward, Crypto Industry Awaits Clarity – CCN.com
Key Takeaways
A federal judge has made a significant ruling in the SECs lawsuit against Binance and its founder Changpeng Zhao.
Judge Amy Berman Jackson of the District Court for the District of Columbia handed down this decision, dismissing some charges while allowing others, including major fraud and registration allegations, to proceed.
The charges that will continue pertain to Binances initial coin offering (ICO), the ongoing sales of Binance Coin (BNB), BNB Vault, staking services, failure to register as a securities platform and related fraud claims. However, the judge dismissed charges related to secondary sales of BNB and the Simple Earn program, underscoring the complexities involved in applying securities laws to cryptocurrency transactions.
This split decision illustrates the challenges courts face in navigating the complex legal sector of crypto regulation. The lawsuit, which was filed last summer against Binance, Binance.US, and Zhao, accuses them of operating unregistered broker, trading, and clearing services in the US and dealing in unregistered digital asset securities.
Similar allegations have been made against other prominent crypto exchanges like Coinbase, Kraken, Consensys, and MetaMask, indicating a comprehensive enforcement approach by the regulator in the cryptocurrency sector.
Judge Amy Berman Jacksons recent decision in the SECs lawsuit against Binance and Changpeng Zhao emphasizes the distinction between investment contracts and the tokens themselves, a critical point for determining the application of securities laws to cryptocurrency transactions.
In her ruling, Judge Jackson aligns with the Supreme Courts historical interpretation of what constitutes an investment contract within the definition of a security. She draws on previous judicial precedents, notably Judge Analisa Torres 2023 decision in the SECs case against Ripple Labs, to highlight the significance of economic realities in these determinations.
Zhao, who is currently serving a four-month sentence for a separate sanctions violation charge brought by the Department of Justice and the Treasury Department, faces these SEC civil charges independently of his criminal proceedings.
The courts dismissal of arguments based on the major questions doctrine, a legal principle from Supreme Court precedent that restricts federal agencies power in significant industries without clear Congressional authorization, adds further definition to the legal boundaries surrounding cryptocurrency regulation.
Judge Berman Jackson noted that while the cryptocurrency industry is significant, it does not yet have the pervasive influence necessary to trigger the application of this doctrine. Her perspective establishes an important judicial standard for future cryptocurrency-related cases.
With a hearing scheduled for July 9, the ongoing case against Binance and Changpeng Zhao is expected to significantly impact the regulatory sector of crypto assets, influencing compliance requirements and operational tactics for crypto exchanges and other related entities.
This legal stance was in response to Binance, the worlds largest crypto exchange, which requested a federal judge to dismiss the SECs lawsuit against it.
The hearing concerning Binances petition became the second notable legal confrontation in less than a week, potentially shaping the future scope of the SECs control over the cryptocurrency industry in the US. This followssimilar legal disputes , between Coinbase and the SEC where they debated comparable regulatory issues.
During the hearing, Matthew Gregory, representing Binance, contended that the SEC has failed to establish clear regulations for the cryptocurrency sector. He argued this point to support Binances position in the legal dispute.
He then stated:
The SEC to this day has been talking out of both sides of its mouth when it comes to crypto tokens Theyre telling the industry (to) come in and register, while simultaneously with their other hand holding the door closed and preventing any viable path to do that.
SEC lawyers previously responded to Binances argument by emphasizing the flexibility of a key legal test, implied to be the Howey Test, used to determine the nature of financial products. They argued that there isnt a bright line clearly separating securities from non-securities, indicating the nuanced application of the law in this domain.
Meanwhile, Binance has requested Judge Amy Berman Jackson, who is overseeing the case, to dismiss the charges brought by the SEC against the company and its related parties.
The SEC had initially filed charges against Binance and its former CEO, Changpeng Zhao, in June 2023. The allegations included operating unregistered national securities exchanges and other services, misrepresenting the trading controls and oversight of Binance.US, and conducting unregistered offers and sales of securities.
This court proceeding for Binance comes on the heels of a similar hearing held on January 17, involving Coinbase, a competing cryptocurrency exchange. Coinbase also presented arguments seeking the dismissal of similar allegations made by the SEC.
During the recent hearing, Judge Jackson appeared notably critical of the arguments presented by Binance, as reported by various sources. Reuters highlighted that Judge Jackson seemed dismissive of Binances reliance on the major questions doctrine in one of their arguments. This doctrine implies that the SEC requires Congresss approval for certain regulatory measures, a point Binance used to challenge the SECs actions.
Fortunes Leo Schwartz reported that Judge Jackson was not convinced by Binances claim that securities offerings must always involve contracts. She pointedly remarked that Binance was being a little too cute with this assertion and clarified that the Howey Test, used to determine what constitutes a security, encompasses broader criteria. Further, Judge Jackson criticized an analogy made by Binance comparing baseball cards, typically not regarded as securities, to the products under scrutiny in this case.
Crypto lawyer Jeremy Hogan noted that Judge Jackson also questioned the validity of Binances fair notice defense. This defense suggests that the SEC should have provided Binance with a warning regarding its alleged securities violations prior to filing formal charges.
Judge Berman Jackson also directed critical inquiries towards the SECs position in the Binance case, as reported by Blockworks journalist Casey Wagner. In the SECs initial charges, the regulator classified Binances own cryptocurrencies, such as BNB and the now largely inactive Binance USD (BUSD) stablecoin, as securities.
Furthermore, the SEC contended that several other tokens which Binance handles but does not issue, including but not limited to Cardano (ADA), Polygon (MATIC), and Solana (SOL), also fall under the category of securities. Judge Jackson scrutinized these claims, expressing skepticism over the SECs arguments.
She stated:
If its so obvious that these are securities, where has the [SEC] been? And why isnt it relevant that the SEC took the opposite position or no condition for so many years?
In response to the discussion, an SEC lawyer clarified that under the Howey Test, regulators are not obligated to notify parties about potential violations. This was in reference to Binances fair notice defense.
Judge Jackson raised additional concerns regarding the several third-party tokens that Binance manages but does not issue. She expressed worries about the potential complexity in discovery and the numerous trials that might arise from each of the named assets, especially since the issuers of these tokens are not currently parties in the lawsuit.
The SECs allegations are partly based on the premise that many ongoing activities involving the relevant crypto assets are associated with a reasonable expectation of profit, fulfilling one criterion of the Howey Test. However, the specifics of how the SEC plans to present and argue this aspect of its case in future legal proceedings are yet to be seen.
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Binance.US Says it Looks Forward to its Ongoing Fight With the SEC – Decrypt
Binance.US said Monday it looks forward to defending itself against the U.S. Securities and Exchange Commission following a court's decision to allow the regulators case against the crypto exchange to proceed.
In a statement posted to social media platform X, Binance.US expressed confidence in its legal position while pushing back against accusations of securities violations.
"We have always utilized the limited guidance that the SEC has offered to the crypto industry to operate our business in a compliant way," Binance.US said. "The fight continues."
Binance's U.S. arm said it was established to serve customers in full compliance with U.S. laws and regulations despite running afoul with the regulator last year.
The SEC sued Binance Holdings Ltd., BAM Trading Services, BAM Management U.S., and founder Changpeng "CZ" Zhao, alleging violations of U.S. securities laws, in June 2023.
The SEC claims that Binance.US customer assets could be improperly accessed and controlled by employees of the global Binance entity outside the U.S.
Binance.US said Monday it maintains a 1:1 reserve for all customer assets and operates robust compliance and risk programs to ensure the safety and security of its platform.
The company also criticized the SECs approach, describing it as "regulation by enforcement" and accusing the Commission of politically motivated overreach under its current leadership by Chairman Gary Gensler.
Binance.US said it has participated in extensive discovery processes, during which time the exchange posits the SEC has yet to present evidence of any wrongdoing.
We remain confident in our position that the SECs case is unsupported by the facts or the law and that the Commission lacks the very authority it is seeking to wield in bringing its action against us, it said.
"We believe this position will be validated by the Court in due course," Binance.US said, highlighting its confidence in a favorable legal outcome.
Despite the legal woes, the company said it would continue to operate smoothly and introduce new features and updates.
The SEC did not immediately return a request for comment.
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Binance.US Says it Looks Forward to its Ongoing Fight With the SEC - Decrypt