SEC Uses Terra Case Ruling Against Binance
The Securities and Exchange Commission (SEC) is intensifying its legal battle against crypto exchanges Binance and Coinbase. In its ongoing efforts to secure victory in these cases, the SEC has brought attention to a recent landmark ruling to strengthen its arguments.
In the case against Binance, the SEC filed a notice of supplemental authority, citing Judge Jed Rakoff’s ruling in the Terraform case. The SEC believes that several issues resolved in its favor in that case are similar to the ones raised by Binance.
Judge Rakoff ruled on December 28 that LUNA and UST tokens are securities, which aligns with the SEC’s case against Binance for alleged violations of securities laws.
The SEC argued that Binance cannot dismiss the case by setting aside the Howey test, as Judge Rakoff ruled that the test remains a binding statement of law. The SEC also noted that Judge Rakoff considered programmatic sales of LUNA on exchanges like Binance as investment contracts, regardless of how they were sold.
SEC Also Targets Coinbase
In addition to Binance, the SEC filed a notice of supplemental authority in its case against Coinbase. The Commission referred to the court’s ruling in the Terraform Labs case to oppose Coinbase’s motion.
Coinbase had filed a motion to dismiss the case, arguing that the SEC lacked jurisdiction. The SEC is relying on the Terra case as it believes some resolved issues in its favor are relevant to Judge Failla’s consideration of Coinbase’s motion.
Notably, the SEC sued Coinbase just one day after filing the lawsuit against Binance. The Commission alleges that Coinbase violated securities laws by offering and trading unregistered securities, including tokens like SOL, ADA, MATIC, FIL, and SAND.
The courts in both cases will need to consider the reasoning behind Judge Rakoff’s decision and determine its applicability. They will also be guided by Judge Analisa Torres’ ruling in the SEC’s case against Ripple.
Hot Take: SEC Strengthens Cases Against Binance and Coinbase
The SEC is ramping up its efforts to pursue legal action against crypto exchanges Binance and Coinbase. By citing Judge Rakoff’s ruling in the Terra case, the Commission aims to strengthen its arguments that LUNA and UST tokens are securities, similar to the allegations against both exchanges.
This move by the SEC demonstrates its determination to enforce securities laws within the crypto industry. The outcome of these cases will have significant implications for how exchanges operate and whether certain tokens will be classified as securities.
As the legal battles continue, it remains to be seen how the courts will interpret Judge Rakoff’s ruling and whether it will impact the outcomes of these cases. The decisions made by the courts will shape the regulatory landscape for cryptocurrencies and set precedents for future enforcement actions.
By
By
By
By