Binance Counters SEC Lawsuit, Asserts Innocence in Securities Violations Case

  • Binance, the largest cryptocurrency exchange, has responded to the charges filed against it by the US Securities and Exchange Commission (SEC).
  • They argue that the SEC’s request for a temporary restraining order should be denied because there is no risk to Binance’s customer assets.

Binance, the largest cryptocurrency exchange, has responded to the charges filed against it by the US Securities and Exchange Commission (SEC). Binance’s legal team has filed several motions in the US District Court opposing the lawsuit. They argue that the SEC’s request for a temporary restraining order should be denied because there is no risk to Binance’s customer assets. They claim that the alleged securities law violations have been happening openly for years and that the SEC’s sense of urgency is manufactured for its own purposes.

The SEC recently charged Binance, Binance.US, and its founder and CEO Changpeng “CZ” Zhao with 13 counts, including operating unregistered exchanges and engaging in the unregistered sale of securities. The SEC also accuses Binance of engaging in deceptive practices, conflicts of interest, and evading the law.

Binance’s lawyers question the timing of the SEC’s charges, noting that they coincided with a lawsuit against Coinbase, another major cryptocurrency platform. They argue that the SEC should have considered the due process implications and the personal interactions between Chairman Gensler and Zhao during the relevant period.

The attorneys also criticize the SEC for not engaging in rulemaking and instead relying on ad-hoc enforcement, which they believe violates the Administrative Procedure Act. They claim that Binance has been in communication with the SEC since 2021, but it was not until February 2023 that they became aware of the investigation targeting Binance.US.

Conclusion

Binance’s legal team urges the court to reject the SEC’s requested relief, emphasizing that it would cause harm both in the United States and globally. They argue that the SEC’s actions are based on an incomplete record and an expedited schedule, which is unfair.

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