Binance Lawyers Seek Dismissal of SEC’s Revised Complaint

Lawyers representing Binance and its former CEO Changpeng Zhao have filed a motion to dismiss the amended complaint by the SEC.

“The SEC verbally acknowledges the court’s decision that crypto assets are not ‘securities’ in themselves, yet refuses to accept the logical conclusion from it,” the document states.

On June 29, Judge Amy Berman Jackson of the District Court for the District of Columbia partially dismissed the Commission’s lawsuit against Binance, allowing most of the allegations to proceed.

She granted the exchange’s motion, removing the regulator’s claims regarding secondary sales of the BNB token, the offering of the BUSD stablecoin, and the Simple Earn product.

The SEC’s allegations concerning the ICO and subsequent sales of BNB by the platform, the BNB Vault program, failure to register, and non-compliance with anti-fraud rules remain. The same applies to the staking service on Binance.US.

The regulator, in turn, amended the complaint. Binance’s lawyers stated that in the revised document, nearly all crypto asset transactions, including token sales on the secondary market, are classified as securities transactions. The argument is based on the notion that some buyers may hope for a future increase in the token’s price.

The motion also highlights the absence of a “consistent legal framework” for recognizing crypto assets as investment contracts, as well as uncertainty regarding the standards applied for their classification.

“The SEC continues to arbitrarily choose winners and losers, recently dropping without explanation its claim that transactions in ETH—the second most widespread crypto asset after BTC—are investment contracts,” the statement reads.

Back in June 5, 2023, the SEC filed a lawsuit against Binance and its then-CEO Changpeng Zhao. The regulator brought 13 charges, including the sale of unregistered securities.

In addition to the largest crypto exchange, other trading platforms, including Coinbase and Kraken, have come under regulatory pressure.