A U.S. judge has ruled that the Securities and Exchange Commission (SEC) lawsuit against Binance and its co-founder Changpeng Zhao (CZ) will proceed, with 10 out of 13 counts given the green light. The ruling by Judge Amy Berman Jackson in the U.S. District Court for the District of Columbia allows the lawsuit to move forward in its entirety, with two counts partially proceeding.
The SEC filed the lawsuit against Binance and CZ last year after the exchange reached a plea deal with various regulatory agencies, resulting in a record $4.3 billion fine. The SEC’s claims against Binance and CZ include allegations of mishandling customer funds, misleading investors and regulators, and violating securities laws.
One count in the lawsuit related to the sale of the stablecoin Binance USD (BUSD) was dismissed, as the stablecoin faced regulatory scrutiny and Binance announced plans to phase out support for it by December 2023. The judge also dismissed part of a claim involving the secondary sale of Binance’s native token BNB.
The SEC’s legal actions against Binance are part of a broader effort to establish cryptocurrencies as securities falling under its jurisdiction. Critics, including some in the crypto industry and Congress, have accused the SEC of overreach in its regulatory efforts.
In a separate development, the SEC filed a lawsuit against Consensys, alleging that its MetaMask wallet and related features violate securities laws.
