SEC Places Heavier Scrutiny on Binance’s Token Listing, Trading Process in Proposed Amended Complaint

The U.S. Securities and Exchange Commission (SEC) has filed a proposed amended complaint against Binance, focusing more intently on the exchange’s token listing practices. This move follows a recent ruling that allowed most of the SEC’s initial allegations to stand, while raising unresolved questions about specific tokens.

In its amended filing, submitted on Thursday, the SEC aims to address concerns highlighted by the presiding judge regarding ongoing sales of BNB and the Binance Simple Earn product. Additionally, the SEC has reinforced its claims regarding ten digital assets that it argues Binance has offered as unregistered securities.

The SEC’s initial lawsuit, filed in June 2023, accused Binance of operating as an unregistered broker and offering unregistered securities through various products, including BNB and BUSD. While the judge dismissed some charges, including those related to the Simple Earn product, most of the SEC’s claims were permitted to proceed.

The latest filing details how Binance’s token listing practices may contravene regulations. It adds specificity about BNB, describing it as a security and noting that Binance has marketed it to investors as part of the exchange’s growth strategy. The SEC alleges that Binance has actively promoted these assets, influencing trading behaviors and expectations among its customers.

One significant revision in the complaint involves the SEC’s terminology. It has replaced the phrase “crypto asset securities” with “crypto assets that were offered and sold as securities,” aiming to clarify its stance on how these assets are categorized.

The SEC’s filing comes with a court-imposed deadline for Binance to respond, which is set for October 11. The regulator maintains that allowing this amended complaint will not unduly harm Binance, as the exchange has been aware of the allegations since last June.

As the case unfolds, both parties are preparing for further legal battles regarding the regulatory landscape surrounding cryptocurrency and the classification of digital assets.