The unsuccessful SEC hearing was the reason the US judges rejected Binance’s request to freeze assets.
The US Securities and Exchange Commission (SEC) on June 12 filed a lawsuit in federal court seeking an order to freeze the assets of Binance. But during the hearing on June 14, the above request was denied.
“Closing all of Binance.US would have significant consequences for the exchange and for the digital asset market as a whole,” Judge Amy Berman Jackson said in dismissing the SEC request. According to Coindesk, the judge criticized the SEC attorney for “rushing” when it was not possible to prove that CZ, the CEO of Binance, or anyone else had access to users’ private keys
The SEC side also could not satisfy the judge with the questions raised around “What makes electronic assets become securities?” and if not “stock” is it a commodity? Matthew Scarlato, an attorney for the SEC, said the regulator provided several examples of cryptocurrencies it believes are securities in the complaint.
In the US, “commodities” will be regulated by the Commodity Futures Trading Commission (CFTC), while “securities” are regulated by the SEC. There is currently no regulation that defines whether cryptocurrencies can be considered commodities. The SEC considers cryptocurrencies to be “security”, while a representative of Binance in the US asserts that the cryptocurrency issued by Binance (BNB coin) is a “crypto asset”.
The request to ban Binance.US was not met, but Judge Jackson said that the SEC and Binance could find common ground in the new agreements. Therefore, the judge asked the two sides to continue negotiating, and if a common agreement is reached, “no need to issue an injunction”. The SEC and Binance need to report the details of the settlement to the court by June 15.
While the SEC is constantly bringing lawsuits against Binance and Coinbase in court, the community pays a lot of attention to SEC Chairman – Mr. Gary Gensler for his involvement in statements about cryptocurrencies. He used to be one of the leading professors of blockchain teaching in the US, but now, as the head of the SEC, Gensler is taking action against companies operating in the crypto space.
In 2018, Mr. Gensler once spoke at an event organized by Bloomberg, asserting that 70% of assets in the cryptocurrency market are not securities. In the fall of the same year, when he lectured at the Massachusetts Institute of Technology (MIT) on “Blockchain and currency”, he himself affirmed that the initial public offering (ICO) does not violate US securities laws, and re- argues that three-quarters of the cryptocurrency market is not securities but commodities, cash, and cryptocurrencies.
But things turned 180 degrees when he took the role of SEC chairman. In his new position, Gensler asserts that most cryptocurrencies are securities and, therefore, subject to SEC regulation. “The inconsistent statement shows that Gensler is a hypocrite,” ZK Shark – one of the influential figures in the crypto community posted a comment on Twitter. On June 12, US Congressman Warren Davidson called for the dismissal of Gary Gensler through a proposed bill to restructure the committee