In a recent development in the SEC lawsuit against Binance, its former CEO Changpeng Zhao, and Binance.US, Judge Amy Berman Jackson has ended the discovery phase. The court dismissed the SEC’s claims regarding sales of BUSD, Simple Earn, and secondary sales of BNB.
Judge Jackson issued several minute orders to conclude the discovery phase. According to court filings, she asked the parties to file a joint submission by July 29 for further proceedings. Binance and the SEC must set deadlines for any motion to amend the complaint or seek relief from the recent motion to dismiss the decision.
Parties seeking amendments or relief must submit plans for how discovery would proceed if such motions are filed. They must also consider whether discovery should occur in phases. Additionally, a minute update on scheduling conference proceedings was added to the docket for meeting and conferring on filing a joint submission by the court’s deadline.
Binance’s partial victory has sparked positive sentiment in the crypto market. The judge indirectly sided with Judge Torres’ doctrine on crypto secondary sales and programmatic sales not being securities. The court ruled that crypto tokens are not securities and that sales of BNB on secondary exchanges were not sufficiently alleged to be securities. Stablecoin BUSD was also not classified as a security, based on US DOJ filings in the Mango Markets lawsuit that contradicted the SEC’s stance.
Although the motion to dismiss by Binance.US was rejected, the exchange remains vigilant and prepared for the next phases of this legal journey. This latest development follows Binance’s recent victory over the SEC, where the court dismissed several charges against the exchange. The court ruled that the SEC did not provide enough evidence to prove that BNB’s secondary market sales were securities transactions. However, the court upheld other charges, including those related to the initial token offering and ongoing sales.
The SEC sued Binance and its CEO last year over alleged wrongdoings, including diverting customer funds and misleading investors. The SEC also claimed that Binance inflated trading volumes and failed to prevent US customers from using its platform. Additionally, the SEC alleged that Binance allowed the trading of financial products that were not properly registered.
Read CRYPTONEWSLAND onThe CEO and co-founder of Enumma, David Barrera, proposed that the SEC revise its initial complaint in order to make a stronger argument. This could indicate that the SEC is looking for more proof before filing new allegations against Binance. The legal battle between the SEC and Binance is part of a bigger effort to tighten rules on the cryptocurrency market. Coinbase and Kraken, two more well-known Bitcoin exchanges, have both been the target of similar measures.
Others think that even if the SEC works to stop money laundering and the funding of terrorist groups, this legislation may hinder innovation in the Bitcoin space. Due to allegations, including money laundering, Binance has been prohibited by several countries. As the Binance case moves forward, the cryptocurrency industry expects more clarity in cryptocurrency regulations.
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