Binance Challenges SEC Lawsuit, Accusing Regulator of Overreach
In a 60-page petition submitted on September 21, Binance argued that the SEC exceeded its authority when it filed a lawsuit against the company. The SEC had accused Binance of various wrongdoings, including mishandling customer funds and violating securities rules.
Binance CEO Slams SEC’s Actions
Binance CEO Changpeng Zhao (CZ) criticized the SEC for attempting to impose penalties retroactively without providing clear guidance on cryptocurrencies. The company’s lawyers also argued that the SEC is distorting securities laws and seeking to expand its jurisdiction globally.
A separate filing aimed to dismiss the lawsuit against Binance.US, which is the US division of the exchange. This move may have been part of SEC Chair Gary Gensler’s strategy to weaken Binance.
Minor Victory for Binance
Binance achieved a small win earlier this week when a federal judge denied the SEC immediate access to Binance.US’s software. The judge suggested that the SEC should refine its requests and speak with additional witnesses instead.
Attorney Jeremy Hogan highlighted the irony of Binance being sued by both the CFTC and the SEC. He jokingly suggested that if FinCen were to file a lawsuit claiming that Binance’s stablecoin BUSD is a currency, it would complete the “Holy Trifecta” of lawsuits against the company.
BNB’s Performance
The native token of Binance, BNB, has been affected by the SEC lawsuit, dropping 1.5% and trading at $211 at the time of writing. Since June, when the lawsuit was filed, BNB has lost 31% of its value and is down nearly 70% from its all-time high in May 2021. However, BNB has still fared better than many DeFi tokens, which have experienced significant losses during this bear market.
Hot Take: Binance Fights Back Against SEC Allegations
Binance is pushing back against the SEC’s lawsuit, accusing the regulator of overstepping its authority and distorting securities laws. The company’s CEO, Changpeng Zhao, criticized the SEC for imposing penalties retroactively without providing proper guidance on cryptocurrencies. Binance achieved a minor victory when a federal judge denied the SEC immediate access to its software. Despite the legal challenges, BNB, the native token of Binance, has performed relatively well compared to other DeFi tokens during this bear market. However, it has still experienced a significant drop in value since the SEC lawsuit was filed.
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