Attorneys representing Binance and its former CEO Changpeng Zhao (CZ) have filed a motion to dismiss the U.S. SEC’s amended complaint.

Key Arguments

“The SEC acknowledges that crypto assets themselves are not ‘securities’ but fails to draw logical conclusions from this,” the filing states.

In June 2023, District Judge Amy Berman Jackson partially dismissed the SEC’s claims, removing allegations related to secondary BNB sales, the issuance of BUSD, and the Simple Earn product. However, the judge allowed the core accusations to proceed, including:

Initial Coin Offerings (ICOs) and subsequent sales of BNB
BNB Vault program
Violations of registration requirements and anti-fraud measures
Staking services on Binance.US

The SEC’s amended complaint now equates most crypto transactions with securities trading, arguing that buyers might expect token values to appreciate.

Binance’s Response

Binance’s lawyers criticized the SEC for its lack of a “consistent legal framework” to classify crypto assets as investment contracts. They also emphasized the uncertainty surrounding regulatory standards.

“The SEC continues to arbitrarily pick ‘winners and losers,’ including reversing its stance on ETH transactions being investment contracts without explanation,” Binance’s legal team noted.

Background

On June 5, 2023, the SEC filed a lawsuit against Binance and CZ, leveling 13 charges, including the sale of unregistered securities. Other crypto exchanges, such as Coinbase and Kraken, have also faced regulatory scrutiny.