Binance continues its battle against the United States securities regulator amid allegations of violations related to certain cryptocurrencies.
SEC’s amended claims “fail as a matter of law”
In the latest motion, Binance’s legal team argues that the court correctly rejected the SEC’s initial attempt to conflate crypto assets with investment contracts.
By doing so, the court acknowledged that crypto assets can be sold as part of an investment contract and that each transaction must independently satisfy securities laws.
“Secondary market resales of the assets long after they were first distributed by their developers are not ‘securities’ transactions.”
Instead, the SEC insisted that almost all transactions involving crypto assets — including blind secondary market resales of tokens — are securities transactions because some buyers might expect the assets to increase in value, the lawyers noted.
According to Binance’s defense, the SEC’s amended claims against Binance “fail as a matter of law” and should be dismissed with prejudice and without leave to amend.
What are blind transactions?
Instead, the SEC alleged that Binance Holdings sold BNB in blind transactions on the Binance and Binance.US exchanges to buyers who did not know they were purchasing tokens from BHL.
Those sales were “blind bid or ask transactions,” the judge said, in which buyers “could not have known if their payments of the money went to Ripple or any other seller of XRP.”
