The SEC has asked the court to consider the Terraform Labs ruling in the case of Binance
The United States Securities and Exchange Commission has filed a petition in federal court seeking summary judgment in its lawsuit against crypto exchange Binance.
In a Jan. 3 filing in the U.S. District Court for the District of Columbia, the SEC said the commission's Dec. 28 ruling against Terraform Labs and its co-founder Do Kwon had “many issues” similar to its implementation. Action on Binance, Binance.US and former CEO Changpeng Zhao. In the Terra case, Judge Jed Rakoff sided with the SEC, ruling that the specific symbols involved in the alleged fraud were securities “because they are investment contracts” and that “the offers and sales of UST are investment contracts.”
The Court's analysis of the Terraform Defendants' so-called ‘stablecoin' UST is particularly relevant when this Court considers the Defendants' contention of Binance's ‘stablecoin' BUSD and the Defendants' service as a service, BNB Vault. and Easy Income Programs,” the Jan. 3 filing says.
The SEC argued that Terraform Labs' ruling provided “additional reasons” for Judge Amy Jackson to consider denying Binance's delisting request. The crypto exchange and Zhao filed a motion to dismiss in September, saying the SEC oversteps its authority and imposes “backward” standards on securities.
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The commission's case is one of the latest from U.S. financial regulators following a $4.3 billion settlement between Binance and the Commodity Futures Trading Commission, the Justice Department and the Treasury Department announced in December. As part of the deal, Zhao agreed to plead guilty to one felony count, for which he will be sentenced in February.
The Terraform Labs and Binance cases are the only two enforcement actions brought by the SEC in 2023 against unregistered securities. The commission filed charges against Coinbase, Ripple, Kraken and others.
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