{"id":229621,"date":"2024-01-15T12:37:47","date_gmt":"2024-01-15T07:07:47","guid":{"rendered":"https:\/\/dripp.zone\/news\/binance-files-joint-response-to-us-secs-terra-lawsuit-supplemental-authority-crypto-news\/"},"modified":"2024-01-15T12:37:49","modified_gmt":"2024-01-15T07:07:49","slug":"binance-files-joint-response-to-us-secs-terra-lawsuit-supplemental-authority-crypto-news","status":"publish","type":"post","link":"https:\/\/dripp.zone\/news\/binance-files-joint-response-to-us-secs-terra-lawsuit-supplemental-authority-crypto-news\/","title":{"rendered":"Binance Files Joint Response To US SEC’s Terra Lawsuit Supplemental Authority – Crypto News"},"content":{"rendered":"

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Attorneys for defendants Binance, Binance.US, and co-founder Changpeng \u201cCZ\u201d Zhao<\/a> have strongly denied the U.S. Securities and Exchange Commission (SEC)\u2019s claims about the relevance of the Terra lawsuit\u2019s summary judgment and findings in this case. They added that the SEC is attempting to contort Terraform lawsuits of 2021 and 2023 to make implausible arguments.<\/p>\n

Binance Response to SEC\u2019s Terra Supplemental Authority<\/h2>\n

In the latest development in the US SEC v. Binance Holdings lawsuit, defendants have filed a joint response to the U.S. SEC\u2019s notice of supplemental authority<\/a>. The SEC directed the court\u2019s attention to orders in the Terraform lawsuit that parties violated securities laws and digital assets mentioned are securities under Howey Test<\/a>.<\/p>\n

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\u201cNone of the points raised in the SEC Notice about Terraform II save its claims in this action any more than the SEC\u2019s arguments based on SEC v. Terraform Labs Pte. Ltd,\u201d as per the filing. Also, even if the SEC\u2019s position were permissible in other circuits, binding precedent in this circuit mandates \u201cpost-purchase commitments\u201d and directs courts to apply a test that can \u201cdistinguish securities from non-securities.\u201d<\/p>\n

Binance argues that the SEC\u2019s non-test has been adopted in Terraform I and II to an extent that cannot distinguish securities from Pok\u00e9mon cards. Also, the defendants said the court\u2019s view of the Howey Test in Terra lawsuit is incorrect as it clearly states that splitting an investment transaction or scheme across multiple contracts still constitutes an investment contract.<\/p>\n

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Moreover, the SEC claims that BUSD itself constitutes a security is irrelevant to the decision in the Terra lawsuit. Also, the CFTC\u2019s claims that BUSD is a commodity subject to that agency\u2019s enforcement authority, which contradicts the SEC\u2019s argument.<\/p>\n

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Binance and Binance.US argue that the staking<\/a> service offered to investors doesn\u2019t promise to pay anything, but provides services to allow access to third parties\u2019 blockchain consensus validation mechanisms.<\/p>\n

Moreover, Terraform lawsuit\u2019s discussion of Regulation S has no bearing on this case. Regulation S provides a regulatory safe harbor\u2014it does not purport to determine the extraterritorial reach of the securities laws. Thus, the SEC\u2019s arguments to consider Terra lawsuit in this case are irrelevant to BUSD, digital assets mentioned in the case, and securities law violation.<\/p>\n

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