In a relentless legal battle against the U.S. Securities and Exchange Commission (SEC), Binance has submitted crucial filings on December 12th. The filings made by Binance aim to dismiss the case launched by the SEC against its companies and former CEO, Changpeng Zhao, back in June. These filings challenge the SEC’s claims that Binance tokens and services are securities or investment contracts. Moreover, Binance asserts that the SEC’s allegations concerning its BNB token are time-barred, as the asset’s offerings occurred outside the U.S. Additionally, Binance argues that the SEC is attempting to apply securities law in an impermissible manner to certain Binance.com transactions. The company also criticizes the SEC for the lack of fair notice about its securities claims and calls for the dismissal of the lawsuit. Furthermore, Binance asserts that the personal jurisdiction claims against Zhao should be dismissed.
An In-Depth Analysis
Dismissing the Case
Binance’s first filing seeks to dismiss the case brought forth by the SEC. The company challenges the SEC’s allegations that its tokens and services fall under the category of securities or investment contracts. Binance contends that the SEC has failed to provide plausible evidence to support these claims, thereby questioning their validity. Furthermore, the filing argues that certain claims related to Binance.com transactions, such as BNB Vault and Simple Earn, are an improper application of securities law outside the U.S., which is not permissible.
The Issue of Timeliness
According to Binance’s filing, the SEC’s claims regarding the BNB token are time-barred. This means that the offerings of the asset took place outside of the jurisdiction of the U.S., indicating that the SEC’s charges are untimely. Binance emphasizes this point, highlighting that the SEC’s claims should be disregarded due to their failure to meet the necessary time constraints.
Lack of Fair Notice
One crucial argument made in Binance’s filing is the SEC’s alleged failure to provide fair notice regarding its securities claims. The lack of clear communication and notice from the regulatory body is put forth as a compelling reason for the dismissal of the lawsuit. Binance contends that it was not adequately informed about the nature of the claims brought against it, leading to a violation of its rights.
The Question of Personal Jurisdiction
Binance’s filing also challenges the personal jurisdiction claims made against Changpeng Zhao. The defense argues that Zhao’s role in controlling Binance alone is not sufficient grounds for jurisdiction. Moreover, the SEC has been unable to establish any substantial evidence demonstrating that Zhao had relevant contact with U.S. users that is directly relevant to the case.
Separating Plea Deals from the SEC Case
It is important to note that Binance and Zhao reached separate plea deals with the Department of Justice (DOJ) and other U.S. government agencies in late November. However, these plea deals are distinct from the ongoing SEC case. The SEC sought to include these plea deals as evidence in their case, but Binance contested this in its filing on December 12th. Binance argues that the plea deals made with the DOJ and other agencies are not relevant to the SEC’s claims against Binance Holdings Limited and Changpeng Zhao. The filing emphasizes that the SEC should not conflate the separate legal proceedings and calls for the dismissal of the case.
Binance’s battle against the SEC continues as the company submits key filings aimed at dismissing the case. These filings challenge the claims made by the SEC regarding Binance tokens and services, the timeliness of the allegations, the improper application of securities law, the lack of fair notice, and the question of personal jurisdiction. Binance firmly believes that the SEC’s claims lack merit and should be dismissed. As the legal battle unfolds, the outcome will have significant implications for both Binance and the regulatory landscape surrounding digital assets.
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