The Securities and Exchange Commission (SEC) intends to take advantage of a partial victory obtained in court against Terraform Laboratories by using it in separate proceedings against the two main cryptocurrency exchange platforms, Binance and Coinbase.
The SEC has filed recent petitions in lawsuits against Coinbase and Binance urging the courts to consider a recent ruling related to Terraform Labs.
Specifically, the agency stated that Binance’s BUSD should be classified as a security, following similar reasoning to what happened with UST in the Terraform Labs case.
SEC Recalls Key Terraform Labs Ruling in Coinbase and Binance Lawsuits
In a document filed Thursday about the lawsuit against Coinbase, the agency presented the Terraform Labs court ruling in the Southern District of New York.
This ruling granted summary judgment on the claim that the UST, LUNA, wLUNA, and MIR tokens are considered securities.
The SEC cited this decision as key support in its opposition to Coinbase’s motion for ruling in its favor. The document was filed with the aim of further strengthening the SEC’s position against Coinbase’s motion.
In his objection, the SEC’s attorney noted that cryptocurrency issuers, including Coinbase, have implicitly encouraged investors to expect an increase in the value of the assets. This is based on issuers’ widespread plan to develop and maintain value through a secondary resale market.
The UST, LUNA, wLUNA, and MIR tokens, although not included in the SEC’s complaint against Coinbase, were cited as examples of securities in the context of the Terraform Labs ruling.
By contrast, the SEC’s complaint against Coinbase focuses on a different set of tokens, including SOL, ADA, MATIC, FIL, SAND, AXS, CHZ, FLOW, ICP, NEAR, VGX, DASH, and NEXO, which according to the SEC should be considered unregistered securities.
News in Legal Processes
As already mentioned, even in the dispute with Binance, the SEC is trying to use the Terraform Labs ruling as a supporting argument.
In a document filed Wednesday, the agency asked a Washington court to consider Terraform’s ruling while considering Binance’s motions to close the case.
The document states that the court’s analysis of Terraform’s UST ‘stablecoin’ is relevant to examining the defendants’ arguments about BUSD, stalking as a service, and programs like BNB Vault and Binance’s Simple Earn.
The SEC notes that Terraform Labs has previously used arguments similar to those of Binance, seeking to separate the sale of tokens from the development and promotion of the Anchor protocol, in which tokens can be staked to generate profits. The SEC says the situation is similar to Binance, which offers BUSD along with staking services, BNB Vault, and Simple Earn.
The SEC’s lawsuit against Binance for allegedly operating an unregistered exchange is ongoing. The agency claims that Binance lied to customers and improperly diverted funds to an investment fund owned by Zhao. Over the past seven months, Binance has repeatedly attempted to dismiss the case.
Justin Sun Transfers Millions in USDT to Binance
Tron (TRX) founder Justin Sol allegedly made a transfer of millions of dollars in USDT to Binance, amid weakness in the cryptocurrency market.
According to on-chain data provider Gaze Chain, an address suspected to belong to Justin Sun allegedly recently deposited 50 million USDT on Binance. The timing of these transfers coincides with an overall decline in the cryptocurrency market, which saw a 1.05% decline in total capitalization to around $1.73 trillion.
This selling is allegedly supported by investors who will profit, especially in anticipation of the expected approval of spot ETFs in the United States.
By Audy Castaneda
