Binance vs. SEC: Legal Showdown
On the 21st of September, the corporation lodged an extensive 60-page appeal contending that the financial regulatory body exceeded its boundaries when it took legal action against them.
In June, the SEC filed a lawsuit against Binance, making allegations of various wrongdoings, such as mishandling customer funds, providing misleading information to investors and regulators, and breaching securities regulations.
Binance and CZ have alleged that the SEC is trying to retroactively impose penalties without offering any public guidance on cryptocurrencies, as reported by Bloomberg.
Binance's CEO Strikes Back
According to the legal submission, Binance's legal team stated:
In its pursuit of asserting control over the cryptocurrency sector, the SEC manipulates the language of the securities laws.
The SEC is also aiming to expand its authority globally to cover transactions on foreign cryptocurrency platforms, according to the submission.
A separate submission aimed to have the lawsuit against Binance.US, legally referred to as BAM Trading Services, dismissed. This move has severely impacted the US arm of the largest crypto exchange globally, likely the original intent of SEC chair Gary Gensler.
Nonetheless, Binance achieved a minor triumph against the regulator earlier this week.
On the 19th of September, the SEC was unsuccessful in persuading a federal judge to immediately grant access to Binance.US's software.
The magistrate judge expressed reluctance to permit the inspection at this moment, suggesting that the SEC should formulate more specific requests and consult additional witnesses.
Attorney Jeremy Hogan pointed out the irony in Binance's experiences this year. The company has been sued by both the Commodity Futures Trading Commission (CFTC) and the SEC.
One agency claims that Binance's stablecoin BUSD is a commodity, while the other asserts that it qualifies as a security. Hogan commented on the possibility of another lawsuit being brought against the company:
Now, if FinCen initiates legal action and claims BUSD is a currency, Binance will have completed the Holy Trifecta!
Did you know that the CFTC sued Binance in March, alleging that BUSD is a commodity?— Jeremy Hogan (@attorneyjeremy1) September 22, 2023
And then, just 3 months later, the SEC sued Binance, alleging BUSD is a security?
Now, if FinCen files suit and alleges BUSD is a currency, Binance will have achieved the Holy Trifecta! SMH. https://t.co/WevWtWvMpi pic.twitter.com/b7ioB9qCB7
Binance's native token, BNB, continues to face uncertainty, with a 1.5% decline observed on that day. Consequently, BNB was trading at $211 at the time of this update.
Furthermore, the asset has experienced a 31% depreciation since the SEC lawsuit in June. Presently, it is nearly 70% lower than its peak value of $686 in May 2021.
Notably, BNB has still fared better than numerous DeFi tokens, which have suffered declines exceeding 90% in this bearish market.