Just one day before a crucial hearing on October 12, United States District Judge Amy Berman Jackson issued major decisions on motions that were still outstanding in the continuing litigation between the U.S. Securities and Exchange Commission (SEC) and cryptocurrency exchange Binance.
The USD Coin issuer Circle, which had previously claimed that assets tied to the U.S. dollar, like USDC, should not be deemed securities, received an amicus brief from Judge Jackson in one of the important orders. According to Circle, those who purchase stablecoins like USDC do not buy them to make money and these payment stablecoins do not satisfy the definition of an investment contract. Jackson's decision to accept Circle as an amicus curiae allows them to offer assistance without taking a side against Binance or its CEO, Changpeng Zhao.
On June 5, the SEC sued Binance, stating 13 allegations, including the sale of unregistered securities in the form of Binance's BNB and BUSD coins. The SEC further said that Binance was operating unlawfully in the US.
On September 22, Binance and Zhao responded by asking the court to throw out the SEC action on the grounds that the SEC had exceeded its regulatory powers. They said that, prior to filing the complaint and asserting its control over Binance's operations, the SEC had not set any precise regulations for the cryptocurrency business.
Prior to the hearing on October 12, there have been major changes with the pending motions and the acceptance of Circle's amicus brief. The verdict in this case might have a significant effect on how digital assets and cryptocurrency exchanges are regulated in the United States.
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