US Lobby Group Urges SEC to Drop Binance Hunt
- The SEC charged Binance with selling unregistered securities and failing to register its services.
- The lobby group claims the SEC’s approach could push crypto projects away from the US.
- Binance and Coinbase have rejected the SEC’s claims that cryptocurrencies are unregistered securities.
The US Chamber of Digital Commerce, a crypto lobby group, has sided with Binance in its ongoing legal dispute with the U.S. Securities and Exchange Commission (SEC). The SEC previously charged Binance with multiple securities violations. However, the Chamber of Digital Commerce has lent its support to Binance and filed an amicus brief, expressing concerns over the SEC’s approach and the potential effects it could have on the crypto industry.
The lobbying group, in its filing, said the SEC is harming financial innovation and forcing cryptocurrency businesses to leave the United States due to its strict rules. The group wrote that the “trillion-dollar blockchain economy is conspicuously avoiding the United States, finding the regulatory environment too opaque and too hostile to conduct business here.”
The Chamber of Digital Commerce further accused the SEC of adopting “a regulation-by-enforcement approach, arbitrarily categorizing various blockchain-based digital assets as securities, and penalizing businesses for failing to obtain SEC registrations that are not actually available to them.”
An amicus brief is a legal document filed by someone not directly involved in a case. It offers extra details to help the court make a decision. In this case, the US Chamber of Digital Commerce seeks to help the court understand the Binance vs. SEC situation better. So, their submission of this brief is to provide additional insights and arguments to assist the court in reaching a well-informed decision.
The Chamber of Digital Commerce likened the SEC’s case against Binance to suing Amazon for selling oranges. The group added that “tokens alone are not securities, and the markets where they are available to buy and sell are not securities exchanges. Whether or not a token was initially sold as part of an ‘investment contract’ is of no consequence.”
The SEC, under Gary Gensler, has targeted cryptocurrency exchanges like Coinbase and Binance over the past few months. The US regulator charged these organizations with providing improperly registered services and listing unregistered securities. However, Coinbase and Binance have argued against these claims and are mounting a strong defense against the regulator.
The US Chamber of Digital Commerce claims the SEC failed to recognize the difference between “the subject of an investment contract security” and “the investment contract itself,” which has led it to falsely tag crypto tokens as securities. The group believes the SEC is more focused on punishing businesses for not getting SEC approvals than giving them clear instructions.
The SEC filed a complaint against Binance in June, claiming that the business was profiting significantly from the sale of unregistered securities while failing to effectively protect its customers. The dispute intensified when the SEC claimed Binance was hiding information during the lawsuit.
Interestingly, many believe the SEC’s powers over the crypto industry could further decline following its decisive loss against Grayscale.
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