Binance Aims to Replicate Ripple’s Legal Success Against SEC
Elena R22 Sept 20232 min read
Binance, the leading cryptocurrency exchange, is harnessing the momentum from Ripple’s recent victory in court. They strive to have their own case with the U.S. Securities and Exchange Commission (SEC) thrown out. The crypto giant’s recent motion seeks to benefit from the legal precedent set by Ripple’s win, wherein the court ruled that the latter’s XRP sales on secondary markets didn’t classify as securities transactions.
Ripple’s Triumph: A New Defense Blueprint
In a recent court filing, Binance spotlighted Ripple’s recent court success, highlighting the ruling from Judge Torres. According to Binance, this case is the sole judicial instance that mirrors the transactions that purportedly took place on Binance’s U.S. platform. The significant conclusion in the Ripple saga was that sales of XRP in secondary markets – such as those through blind bid or ask trades – weren’t investment contracts.
A Question of Precedence
In challenging the charges, Binance underscores that the SEC’s attempt to draw parallels with previous initial coin offerings (ICOs) doesn’t hold water. They stress that there have been numerous instances where courts remained undecided on whether tokens sold by traders were actually securities transactions.
This critical question is at the heart of Binance’s argument. By leaning on the Ripple case’s outcome, Binance pushes the narrative that cryptocurrency trades on its platform shouldn’t be labeled as securities transactions by the SEC.
This perspective is fortified by a part of Binance’s legal memorandum, which essentially states that, like in the Ripple scenario, there was no defining relationship between trading parties that could morph a simple digital asset sale into an investment contract sale.
Binance’s latest attempt to challenge the SEC illustrates how significant court rulings can shape subsequent legal battles in our industry. As Ripple’s mini victory casts its shadow, many eyes will be on this case to see if Binance can achieve its favorable outcome.
