Binance sued SEC over securities allegations
facing lawsuit ❗️
A U.S. District Court judge has ruled that the lawsuit filed by the Securities and Exchange Commission (SEC) against cryptocurrency exchange Binance will largely proceed. The decision was handed down Friday by District of Columbia Judge Amy Berman Jackson and marked a significant development in the case.
The lawsuit, which the SEC launched in June 2023, alleges Binance and its founder and former CEO Changpeng Zhao engaged in activities that violate securities laws. Among the accusations, the SEC alleges that Binance manipulated trading volumes, misappropriated customer funds, allowed U.S. customers to access its platform contrary to its policies, and misrepresented the robustness of its market surveillance.
Additionally, the regulator alleges that Binance illegally facilitated the trading of various crypto tokens that it deemed unregistered securities. This aspect of the case will proceed according to the judge's decision.
Despite the setback for Binance, the decision was a ray of hope for the cryptocurrency exchange and the industry in general. Judge Jackson agreed with a previous court ruling that the SEC had not adequately demonstrated that secondary market sales of Binance tokens (those sold on separate exchanges by parties other than Binance) constitute securities transactions.
The case adds to the challenges facing Binance following a November settlement in which the exchange agreed to pay $4.3 billion with the Department of Justice and the Commodity Futures Trading Commission to resolve issues related to violations related to illicit finance.
