SEC intends to amend Binance complaint, dropping security claims for SOL and other tokens

The U.S. Securities and Exchange Commission intends to seek an amendment to its lawsuit against popular crypto exchange Binance.

The SEC no longer claims that Binance violated US law by providing securities to third parties regarding the crypto asset securities status of tokens like Solana and Polygon.

According to a court filing statement, "At this time, the Court will not have to rule on the sufficiency of the allegations regarding those tokens because the SEC informed Defendants that it plans to amend its complaint, including with regards to the 'Third Party Cryptocurrency Asset Securities' as defined in the SEC’s Omnibus Opposition to Defendants’ Motion to Dismiss, Dkt. No. 172."

In November 2023, the SEC filed a lawsuit against Changpeng Zhao, the former CEO of Binance, Binance.US, and Binance. The agency claimed that the exchanges provided unregistered broker, trading, and clearing services for U.S.-based digital asset securities. Similar accusations have been made against Coinbase and Kraken, among other exchanges, the post added.

Ten coins— Solana (SOL), Filecoin (FIL), The Sandbox (SAND), Polygon (MATIC), Cardano (ADA), Cosmos (ATOM), Algorand (ALGO), Decentraland (MANA), Axie Infinity (AXS), and COTI—were previously identified by the SEC as securities in its lawsuit against Binance. The amendment passed today will most likely result in changes to these classifications.

The SEC cannot reasonably expect defendants to consent to merits discovery for claims on which the SEC may soon seek leave to amend its allegations until they have a set of proposed amended allegations before them," the filing stated.

The post further said “There is no clear indication that the agency intends to give up on the claim that these tokens are securities, even though the most recent legal document raises the possibility of a change in policy regarding crypto asset securities.”

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