A federal judge dismissed some of the charges filed by the U.S. Securities and Exchange Commission (SEC) against Binance and its founder Changpeng Zhao, allowing other charges to proceed, including charges against Binance.US' holding company.
In a ruling issued late Friday, District of Columbia District Court Judge Amy Berman Jackson ruled that the SEC may file a lawsuit against Binance for its initial coin offering and charges of BNB, BNB Vault, staking services, lack of registration and fraud. He accepted Binance and Zhao's request to dismiss the accusations regarding secondary BNB sales and Simple Earn.
The SEC sued Binance, Binance.US and Zhao last summer, alleging that the exchanges provided unregistered brokerage, trading and clearing services for unregistered digital asset securities in the United States. The regulator brought similar charges against Coinbase, Kraken, and as of Friday morning, Consensys and MetaMask.
The SEC has brought a plausible claim on most charges, Judge Jackson wrote in his order Friday.
Zhao is currently serving a 4-month sentence on sanctions violation charges brought by the Department of Justice and the Treasury Department. The SEC's case against him is separate from this criminal offense.
In granting Binance's request to dismiss the claim of secondary BNB sales, the judge cited Judge Analisa Torres' 2023 decision in the SEC case against Ripple Labs and said that the economic reality of token transactions is important to the application of securities law.
Like other justices, Judge Jackson rejected arguments that the SEC cannot bring enforcement actions against crypto assets under the "big questions doctrine," a Supreme Court precedent that Congress should direct federal agencies' authority toward key industries.
The judge set a hearing for July 9.
👨⚖️📰 What do you think this decision means for cryptocurrency exchanges? We are waiting your comments!