Binance Holdings, its U.S. counterpart, and CEO Changpeng Zhao have submitted motions requesting the dismissal of the lawsuit filed against them by the SEC.
"The SEC pursues these unconventional claims retroactively, attempting to establish liability for crypto asset sales dating as far back as July 2017, a period when the SEC had not yet provided any public guidance regarding cryptocurrency," stated the filings.
Binance's legal representatives argued that the regulator has fundamentally misinterpreted securities laws and their relevance to crypto assets. The filing further contended that the SEC distorts the language of securities laws in its pursuit of regulatory authority over the cryptocurrency industry.
In addition to the petition filed by Binance and Zhao, Binance.US, the American branch of the crypto exchange legally known as BAM Trading Services, reportedly also sought the dismissal of charges in a separate 56-page filing submitted on the same day.
The SEC initiated legal action against Binance and its affiliates on June 5, alleging that Binance engaged in the sale of unregistered securities and conducted unlawful operations in the United States.
This SEC action followed a lawsuit by the Commodity Futures Trading Commission (CFTC) against Binance three months prior. The CFTC's lawsuit accused Binance of failing to register with the commission and violating multiple regulatory guidelines.
As a consequence of the ongoing regulatory scrutiny, trading activity on Binance.US has suffered a significant decline, with daily trading volumes plummeting by more than 98% since September 2022. On September 13, Binance.US announced a 30% reduction in its remaining workforce, and its president and CEO, Brian Shroder, also left the company.
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