The US cryptocurrency industry Leaders say the SEC overstepped with the Binance allegations
The digital asset market is uniting against the US government in the case of Binance, another significant crypto startup, just days before Sam Bankman-Fried’s trial is slated to start in New York.
In documents this week, stablecoin issuer Circle Internet Financial Ltd. and cryptocurrency investment firm Paradigm Operations argued that the Securities and Exchange Commission had overstepped its bounds when it brought charges against the largest cryptocurrency exchange in the world in June.
According to the regulator, the SEC, Binance participated in “an extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law.”
Binance referred to the complaint as “disappointing” and claimed to have engaged in sincere discussions with the SEC to resolve the issue.
In support of Binance’s recent request to have the case dismissed, Paradigm submitted an amicus brief. The crypto fund said in its complaint that the SEC has adopted “an incoherent approach” to regulating crypto assets and that these efforts were founded on a “mistaken assertion” that current laws cover crypto.
Unsavory claims should not limit an agency’s authority, Paradigm wrote in the brief, noting that it had no financial stake in Binance. “The agency’s arrogation of authority cannot stand, regardless of what the SEC may say about a particular defendant,” it stated.
Coinbase Global Inc., a competitor of Binance and issuer of the USDC stablecoin, is a minority shareholder in Circle. Circle submitted a resolution of “support of neither party.” By filing, Binance’s BUSD stablecoin’s treatment by the SEC as an unregistered securities was protested.
“This marks the first time the SEC has taken enforcement action against a true payment stablecoin,” Circle stated in its complaint. “As a result, this Court’s decision may have important repercussions for rival issuers like Circle, as well as for the broader digital-asset ecosystem and US economy.”
A request for comment made after regular business hours was not immediately responded to by the SEC.
Brian Armstrong, the CEO of Coinbase, and Mike Novogratz, the founder of Galaxy Digital, visited Capitol Hill earlier this week to convince lawmakers of the value of the cryptocurrency sector to the US economy.
Coinbase is really active. Along with its legal battle with the SEC, the exchange has backed a legal protest against government actions taken against coin mixer Tornado Cash and is organizing cryptocurrency owners to speak out for the business before the 2024 US elections.
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