Why Binance gets ready to continue fight with SEC?

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As a researcher with experience in the cryptocurrency industry, I’m closely following the developments surrounding Binance.US and their legal battle with the U.S. Securities and Exchange Commission (SEC). The recent court decision allowing the case to move forward is a significant setback for Binance, despite their readiness to continue fighting.

Binance.US, the United States branch of the Binance cryptocurrency exchange, is gearing up for another regulatory battle within the country.

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I, as an analyst, would express that Binance.US has publicly announced its determination to carry on contesting the Securities and Exchange Commission (SEC) in the United States. The team at Binance.US reminded that the court decision upheld the ongoing nature of the SEC’s case against them.

As a crypto investor, I’ve anticipated this development and am eager to see how this legal matter unfolds through the judiciary system.

Binance.US statement

As a researcher, I’d like to emphasize that Binance.US was established with the specific goal of catering to clients in adherence with U.S. laws and regulations. Furthermore, this platform asserts that it has utilized the scant guidance provided by the Securities and Exchange Commission (SEC) to ensure its operations comply with industry standards.

“Our company, similar to numerous others within our industry, has been impacted by the Securities and Exchange Commission’s (SEC) aggressive enforcement strategy and perceived overreach under its present leadership.”

Binance.US statement

According to Binance.US, no proof of misconduct has been found by the SEC during their 11-month investigation. Consequently, the SEC’s allegations require solid factual basis or legal justification, and they may need additional powers to file a lawsuit.

“Our company is thriving, and we remain dedicated to providing digital assets to the American public. The battle persists.”

Binance.US statement

U.S. court allows SEC to continue case against Binance

As a crypto investor, I’ve closely followed the developments between Binance and the SEC. To my disappointment, on June 28th, Binance was unable to persuade the U.S. court to discard most of the Securities and Exchange Commission’s (SEC) accusations against them.

Judge Amy Berman Jackson granted the request from the exchange for dismissing the SEC’s allegations concerning the secondary sales of BNB tokens, BUSD stablecoin offerings, and the Simple Earn product. However, the Securities and Exchange Commission’s probe into the ICO, subsequent token sales on the BNB platform, the BNB Vault program, unregistered securities offerings, and non-compliance with anti-fraud regulations will proceed. The same applies to Binance’s staking service.

Further, the Securities and Exchange Commission (SEC) continues to assert charges against Changpeng Zhao, former CEO of Binance. The regulatory body alleges that Zhao held significant influence over the exchange, making it necessary for Binance to comply with the Exchange Act by registering.

What the experts say

In spite of the court’s verdict, attorney Scott Johnson described Berman Jackson’s judgment as a significant loss for the regulatory body.

It’s surprising that the SEC suffered a setback in their case against Binance regarding secondary sales. I had anticipated Failla would provide such an analysis, but it appears Berman took the lead instead.

— Scott Johnsson (@SGJohnsson) June 29, 2024

Eleanor Terrett of Fox Business anticipates that attorneys representing Coinbase, Kraken, and Consensys will leverage the recent SEC ruling against Binance to bolster their arguments in ongoing regulatory legal battles.

As a legal analyst, I can confidently assert that the recent court decision in favor of Ripple will significantly strengthen the arguments of Coinbase, Kraken, and Consensys in their own ongoing litigations with the Securities and Exchange Commission (SEC). The SEC can no longer rely on the notion that the Ripple ruling was an isolated instance with no broader implications for other digital asset cases.

— Eleanor Terrett (@EleanorTerrett) June 29, 2024

Binance’s legal proceedings with American regulators

Beginning on June 5, 2023, the Securities and Exchange Commission (SEC) initiated a legal action against Binance, Zhao, and associated entities for allegedly breaching securities trading laws. According to the court filing, the SEC identified the BNB token and the BUSD stablecoin, which carries the Binance brand, as securities.

Binance strongly asserted its commitment to responding to the SEC’s accusations. The cryptocurrency platform criticized the regulatory body for insufficient dialogue and failing to offer clear direction and support to the digital asset industry.

In November 2023, Binance reached a settlement with the U.S. Department of Justice (DOJ) over allegations of violating sanctions and money laundering regulations. The financial penalty for Binance totaled $4.3 billion. For Zhao personally, the fine was set at $50 million.

In December 2023, regulatory documents were released by the relevant authority, which included new evidence and confessions of wrongdoing from Binance’s trading platform. The Securities and Exchange Commission (SEC) acknowledged this development but announced its intention to press on with legal action against Binance, notwithstanding the previous settlement with the Department of Justice (DOJ).

Representatives from regulatory bodies propose that the federal court take into account all declarations and acknowledgments made by both the crypto exchange and Zhao on November 21, 2023. For instance, in a plea deal with the Department of Justice, the digital asset trading platform admitted to intentionally breaking the law. In contrast, during the SEC lawsuit, the platform contended that they had not received any communication from the Commission regarding non-compliance with securities regulations.

How the lawsuit against Binance affected the crypto market

Binance’s market standing has been impacted by various legal issues. The SEC is perceived as taking excessive measures according to Binance and its previous CEO, Zhao, who supports the company’s actions. Nevertheless, the cryptocurrency community stays alert as they observe the progression of these legal disputes.

As a seasoned analyst, I’d rephrase it this way: The Securities and Exchange Commission (SEC) remains active in enforcing regulations against crypto companies. According to SEC Chairman Gary Gensler, a majority of digital assets fall under the category of unregistered securities. Consequently, the SEC is resolute in its mission to oversee the crypto industry.

The legal action against Binance forms part of a larger regulatory clampdown on the crypto sector. Its resolution could bring significant repercussions not only for Binance but also for the entire cryptocurrency market.

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2024-07-04 18:14