U.S. Federal Court Rules Cryptocurrency Sales Are Not Securities Offerings in Landmark Binance Case
Summary:
The U.S. Federal Court ruled that cryptocurrency and secondary sales of Binance Coin (BNB) are not considered securities offerings, marking a significant win for Binance.US. This judgment came after the Securities Exchange Commission's (SEC) multiple allegations against Binance were dismissed by the court. The verdict stipulates that the nature of individual token sales should be the focus, not cryptocurrencies themselves. This comes as a relief for investors who were previously informed by the SEC that 68 cryptos, including BNB, were securities. The next Binance.US vs SEC hearing is slated for July 9.
U.S. Federal Court Judge Amy Berman Jackson has handed down a ruling that cryptocurrencies and secondary sales of Binance Coin (BNB) do not classify as securities offerings. This landmark judgment is a significant breakthrough for Binance.US, having dismissed several allegations against them by the United States Securities and Exchange Commission (SEC). A press release from Binance on July 2 stated the court found the SEC unable to demonstrate that secondary market sales purchasers projected profits as their primary reason for acquiring BNB.
According to Judge Jackson's ruling, cryptocurrency tokens are not securities themselves. This decision implies that cryptocurrencies are not subject to SEC oversight as investment contracts within the United States, as outlined in the court announcement. The judgment emphasizes that the focus should be on each individual token transaction and not consider cryptocurrencies as securities. This verdict offers relief to investors, considering the SEC previously classified 68 cryptocurrencies as securities.
Back in June 2023, the SEC brought forward a lawsuit against Binance and the Coinbase exchange, accusing them of alleged securities violations. The SEC claimed that Binance and its founder, Changpeng Zhao, had misused billions worth of user funds. Although there was no evidence for these claims, Binance was charged with violating Anti-Money Laundering laws and agreed to a record-breaking criminal fine of $4.3 billion.
The subsequent hearing for the case of Binance.US vs SEC is scheduled for July 9. Binance.US, the American division of the world's largest exchange, has declared its preparation for a prolonged period of legal discovery, expressing anticipation for the ongoing legal proceedings.
Published At
7/2/2024 2:13:58 PM
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