Chamber of Digital Commerce Joins Industry Leaders to Challenge SEC's Lawsuit Against Binance
The Chamber of Digital Commerce has joined forces with various digital assets firms, associations, legal experts, and legislators to challenge the U.S. Securities and Exchange Commission (SEC) in its lawsuit against Binance.
The prominent blockchain trade association has recently filed an amicus brief, aiming to disrupt the SEC's attempt to regulate the cryptocurrency sector without explicit authorization from the Congress and putting a halt to the SEC's method of regulation through enforcement.
Cody Carbone, the Vice President of Policy at the Chamber of Digital Commerce, criticized the SEC's approach, claiming that the agency has been trying to regulate the entire digital asset ecosystem through enforcement actions, instead of issuing guidance or going through the proper notice and comment rulemaking channels.
"The enforcement actions are paralyzing the market and sending digital asset innovation overseas."
The Chamber argued that the SEC's enforcement-based method of classifying digital assets as securities and penalizing cryptocurrency businesses stifles innovation and forces these companies to relocate outside the United States.
Furthermore, they asserted that the SEC lacks the congressional authority to oversee all digital assets as securities.
While legislative bodies are actively working on establishing a regulatory framework, the Chamber believes that the SEC's actions pose risks to the industry and its stakeholders.
Chamber of Digital Commerce Calls for Dismissal of Binance Lawsuit
In its amicus brief, the Chamber of Digital Commerce called for the dismissal of the lawsuit, citing several claims.
They argued that the SEC has exceeded its jurisdiction, that digital assets do not constitute investment contracts, and that token transactions do not meet the criteria for Exchange Act registration requirements.
Binance.US, along with Binance Holdings and CEO CZ, has also submitted a motion to dismiss the lawsuit, asserting that the SEC has overstepped its jurisdiction.
Binance.US has criticized the SEC's recent document discovery and deposition requests as "unreasonable" and has requested permission to submit confidential documents to support their case.
While the specifics of these documents remain confidential, it appears that Binance.US is cooperating with the SEC to some extent while defending against the lawsuit.
Back in June, the SEC sued Binance and its CEO for their “blatant disregard of the federal securities laws,” unveiling 13 charges against the platform, including operating an unregistered exchange.
The agency accused Binance of breaking the law by offering unregistered securities to the general public, including its BNB token and BUSD stablecoin.
Other charges levied against Binance by the SEC included the company's failure to register as a broker as well as its failure to register as an exchange.