US SEC Identifies 12 Crypto Tokens as Securities in Binance Lawsuit – In a recent lawsuit filed against Binance and its CEO, Changpeng Zhao (CZ), the U.S. Securities and Exchange Commission (SEC) has designated 12 cryptocurrency tokens as securities. The SEC alleges that Binance and its platforms have facilitated the trading of crypto assets that are considered investment contracts and therefore fall under the category of securities.
The lawsuit also includes Bam Trading Services, the operator of Binance US, and its parent company Bam Management US Holdings, with Zhao holding an 81% ownership stake in Bam Management, according to the SEC. The SEC alleged that the defendants have “unlawfully solicited U.S. investors to buy, sell, and trade crypto asset securities through unregistered trading platforms available online at Binance.com and Binance.US.”
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The regulator added that since the Binance platforms launched, the defendants “have made available for trading on them crypto assets that are offered and sold as investment contracts, and thus as securities.” The SEC’s lawsuit details: “This includes, but is not limited to, BNB, BUSD, and the units of each of the crypto asset securities further described below — with trading symbols SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, and COTI.”
Noting that Binance.com lists more than 350 crypto tokens, the lawsuit further states: “The Binance platforms have made available for trading crypto assets that have been the subject of prior SEC enforcement actions based upon their status as crypto asset securities, including but not limited to AMP (the AMP token), REP (the Augur token), UST (the Terrausd token), and TRX (the token associated with the Tron network).”
As mentioned in its lawsuit against Bittrex, the U.S. Securities and Exchange Commission (SEC) has asserted that various crypto tokens, such as DASH, TKN, NGC, and OMG, should be classified as securities. The SEC’s legal battle with Ripple Labs over XRP is still ongoing. Furthermore, other regulatory authorities have made similar claims regarding certain crypto tokens. For instance, New York Attorney General Letitia James filed a lawsuit against Coinex in February, stating that AMP, LUNA, LBC, and RLY are also considered securities.
The lawsuit filed against Binance on Monday explicitly mentions several crypto securities but notably excludes bitcoin (BTC) and ether (ETH). According to SEC Chairman Gary Gensler, he has previously stated that, apart from bitcoin, all other crypto tokens are considered securities. However, when questioned during his testimony before the House Financial Services Committee, he declined to provide a definitive answer regarding whether ether should be classified as a security or a commodity.
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On the other hand, Rostin Behnam, the chairman of the Commodity Futures Trading Commission (CFTC), has firmly asserted that ether is a commodity.Nevertheless, it is important to note that the opinion of the SEC or its chair does not hold the authority of law, as emphasized by legal expert Logan Bolinger. The ultimate authority in interpreting and applying the law lies with judges, not SEC chairs.
