The United States Securities and Exchange Commission (SEC) has expanded its lawsuit against the popular cryptocurrency exchange Binance, adding new tokens classified as securities.
Lawsuit Expansion
The updated case now includes tokens such as Axie Infinity (AXS), Filecoin (FIL), Cosmos (ATOM), Sandbox (SAND), and Decentraland (MANA). This move demonstrates the SEC's ongoing efforts to regulate the cryptocurrency industry by classifying digital assets as securities.
New Allegations Against Binance
The SEC has charged Binance and its U.S. affiliate BAM Trading with enabling transactions using recently categorized securities. The agency claims that Binance's platforms flooded the market with promotional information from promoters and issuers, portraying these tokens as viable investments. The SEC also states that Binance lacks proper registration to operate as a clearing agency, broker-dealer, or exchange and that it failed to disclose the risks and legality of the traded tokens, exploiting interstate commerce mechanisms to execute securities transactions on behalf of others.
Criticism from the Crypto Community
The legal expansion has drawn criticism towards the SEC's regulatory stance. Ripple’s chief legal officer Stuart Alderoty chastised the SEC for inconsistent allegations, while Coinbase’s chief legal officer Paul Grewal pointed out contradictions in the SEC's position, recalling the 2020 lawsuit against Ripple.
This ongoing legal and regulatory debate continues to shape the landscape of cryptocurrency regulation and enforcement.
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