SEC Non-Compliance Tabled
Binance’s lawyer referenced the situation between Coinbase and the SEC to argue that the regulator failed to cooperate with Coinbase and provide guidance on crypto regulation. The SEC later indicted Coinbase for operating as an unregistered broker, exchange, and clearing agency. In the Binance hearing, the exchange’s lawyer pointed out that the SEC sued Coinbase while simultaneously encouraging registration. This highlights the SEC’s lack of clarity in regulating certain crypto activities.
Judge Katherine Polk Failla demanded a description of specific token features that make them investment contracts in the Coinbase-SEC lawsuit. The lack of clarity has clouded the regulator’s judgment and led to legal issues with crypto-based businesses.
The Postponement of the Binance Hearing
The Binance hearing was initially postponed due to snowstorms but resumed on January 22. Binance is seeking a dismissal of the lawsuit against it and considering moving the case to a Washington court. Like Coinbase, Binance is accused of facilitating the trade of securities, violating KYC rules, and misleading users.
Several crypto exchanges have expressed their dissatisfaction with the SEC’s tactics and believe that regulating crypto falls outside the regulator’s jurisdiction.
Hot Take: SEC’s Lack of Clarity Raises Concerns for Crypto Businesses
The recent Binance hearing has shed light on the SEC’s failure to provide clear guidance for crypto activities. This lack of clarity has resulted in legal disputes with major cryptocurrency exchanges like Coinbase and Binance. The SEC’s inconsistent actions, such as suing Coinbase while encouraging registration, raise concerns about its regulatory approach. Judge Failla’s demand for specific token features further highlights the need for clarity in determining investment contracts.
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