The SEC intends to introduce the crypto Solana in the Binance case

The Securities and Exchange Commission (SEC) degli Stati Uniti ha annunciato l’intenzione di modificare la denuncia contro Binance per includere specifiche accuse riguardanti crypto di terze parti, come Solana (SOL). 

This move represents a further development in the context of the growing regulation of digital assets by the agency.

The move by the SEC against Binance and the modification of the accusations towards crypto like Solana

The original complaint by the SEC against Binance was filed in June 2023, and contained several allegations of violations of securities and commodities laws.

Among the main accusations were the management of an unregistered stock exchange, the failure to implement adequate AML (Anti-Money Laundering) controls, and deceiving investors about the platform’s operations and trading volumes.

The complaint focused mainly on Binance and its executives, including the former CEO Changpeng Zhao.

The third-party tokens are digital assets issued by companies other than Binance. These tokens, like Solana (SOL), were initially excluded from the SEC’s complaint against Binance. 

However, with the increase in regulatory pressure and the growing concern about the nature and use of these tokens, the SEC has decided to delve deeper into the issue and include specific charges regarding these assets in its complaint.

The SEC argues that many of these tokens are unregistered securities. A security, according to U.S. law, is any instrument that represents an investment in a common enterprise with the expectation of profit derived from the effort of others. 

The SEC has used the Howey test, a criterion established by the United States Supreme Court, to determine if an asset is a security. According to this test, if an investment of money in a common enterprise with the expectation of profit derived from the efforts of others, the asset is considered a security.

The importance of registration and the implications for Binance

The registration of a security with the SEC involves the disclosure of detailed information about the issuer and the security itself, including the risks associated with the investment. 

This process is designed to protect investors by providing them with sufficient information to make informed decisions. The failure to register a security exposes the issuer and intermediaries to severe legal penalties.

The inclusion of third-party tokens in the complaint against Binance could have significant implications for the platform. Binance is one of the largest cryptocurrency exchanges in the world and offers a wide range of tokens for trading. 

If the SEC manages to prove that these tokens are unregistered securities, Binance could be forced to remove them from its platform, significantly reducing the number of assets available for trading. Additionally, Binance could face further legal and financial sanctions.

Binance has stated that it disagrees with the SEC’s allegations and has asserted that it is ready to defend itself vigorously. The platform has maintained that it operates in compliance with local laws and regulations in the various countries where it is present. 

Furthermore, Binance has emphasized its efforts to improve the transparency and security of its platform, implementing strict AML controls and collaborating with regulatory authorities.

The Binance case represents just one example of the growing attention from regulatory authorities towards digital assets. In recent years, the SEC has intensified its efforts to regulate cryptocurrencies and other digital assets, aiming to ensure investor protection and the stability of the financial market. 

This trend is destined to continue, with further investigations and potential legal actions against other cryptocurrency platforms and token issuers.

Conclusions

The intention of the SEC to modify the complaint against Binance to include specific accusations regarding third-party tokens marks a significant step in the regulation of digital assets. 

This development highlights the growing attention of regulatory authorities towards securities compliance and investor protection in the cryptocurrency market. As the case unfolds, the cryptocurrency industry will have to face new challenges and adapt to an evolving regulatory environment.