CZ Fights Back Against the SEC After Release! With Binance's Lawyers Requesting the Court Dismiss the Lawsuit: Why Are All Crypto Assets Considered Securities?

The U.S. Securities and Exchange Commission (SEC) reiterated its allegations against Binance and its founder, Changpeng Zhao, regarding violations of federal securities laws in a revised complaint submitted in September. However, following Zhao's recent release from prison, Binance and Zhao's legal team filed a motion on November 4 to counter the allegations made by the SEC in the revised complaint, requesting the court to dismiss the SEC's claims. (Background: CZ Zhao Changpeng released on 9/29! The SEC reaffirms that Binance 'violated federal securities laws') (Additional background: CZ's best relationship with Binance: can still achieve mutual success after decoupling) The SEC filed a lawsuit against Binance's parent company, Binance Holdings, Zhao Changpeng, and Binance US in June 2023, presenting 13 charges against the defendants, alleging that they operated an unregistered exchange, illegally offered and sold securities to U.S. investors, mishandled customer funds, among other accusations. In June 2024, Judge Amy Berman Jackson allowed most of the SEC's charges to proceed but granted Binance and Zhao's motion to dismiss the SEC's allegations regarding Binance's BUSD, Simple Earn, and the sale of BNB on the secondary market as securities or investment contracts. However, in September, the SEC submitted a revised complaint, reaffirming its allegations against Binance for violating federal securities laws, claiming that Binance played a key role in promoting its digital assets through the release of project investments, trading volumes, and price information. Additionally, BNB is also considered a security and is expected to appreciate in the eyes of investors, constituting the definition of an investment contract. Further reading: CZ Zhao Changpeng released on 9/29! The SEC reaffirms that Binance 'violated federal securities laws.' In the SEC's revised complaint, more tokens were classified as securities, including AXS, FIL, ATOM, SAND, and MANA. Binance and CZ seek to dismiss the SEC's revised complaint. However, following Zhao Changpeng's recent release from prison, Binance and Zhao launched a counterattack, with their legal team filing a motion on November 4 to request the court to dismiss the SEC's allegations in the revised complaint. The legal team criticized the SEC for lacking clarity in its regulatory standards regarding crypto assets, arguing that the SEC has failed to clearly define which crypto asset transactions constitute 'investment contracts.' According to a Coindesk report, the lawyers stated in the motion that the revised complaint only superficially respects the court's earlier ruling that crypto assets themselves are not securities and rejected the logical conclusion of that ruling, which states that secondary market resale transactions conducted long after the assets were first distributed by developers are not securities transactions. Conversely, the SEC's revised complaint insists that almost all transactions involving crypto assets, including blind resale of tokens on the secondary market, are securities transactions because some buyers may expect the asset to appreciate in value. The lawyers criticized the SEC for arbitrary regulatory standards concerning crypto assets, noting that the SEC recently retracted its claims that Ethereum transactions are investment contracts without justification. The conclusion of the motion pointed out that the SEC has submitted two lengthy complaints, requiring the defendants to devote significant resources to respond, but the allegations in the SEC's revised complaint remain legally untenable. In light of this, the SEC's allegations against Binance and Zhao Changpeng should be dismissed. The SEC's lawsuit against Binance and Zhao Changpeng is unrelated to previous criminal charges brought against them by the U.S. Department of Justice and other agencies. Binance reached a settlement agreement with the U.S. Department of Justice in 2023, pleading guilty and agreeing to pay a $4.3 billion fine, while Zhao Changpeng served four months in prison; however, the SEC's lawsuit continues. Related reports: CZ promises to interact regularly with the community: enjoying rare quiet time during this period~ Zhao Changpeng CZ: I will participate in the Binance Blockchain Week in Dubai at the end of October in a personal capacity. Zhao Changpeng CZ's first statement after his release: It's great to enjoy good food, and I will continue to invest in blockchain, AI, and biotech. My book is almost finished. "CZ fights back against the SEC after release! With Binance's lawyers seeking court dismissal of the lawsuit: Why are all crypto assets considered securities?" This article was first published on BlockTempo (the most influential blockchain news media).