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SEC intends to amend complaint against third-party tokens (such as SOL, MATIC) in Binance case
The U.S. Securities and Exchange Commission (SEC) may drop charges against so-called third-party tokens, such as Solana’s SOL and Polygon’s MATIC, that were part of its case against Binance, a report says. filing of the appeal in court early Tuesday morning.
According to the filing, the SEC has already notified the defendants, Binance and its affiliated entities (i.e. Binance.USA and founder Changpeng Zhao), who “intends to seek leave to amend its complaint, including with respect to ‘Third Party Cryptocurrency Securities’… “eliminating the need for the Court to issue a ruling on the sufficiency of the allegations relating to such tokens at this time.”
The issue of third-party tokens came to a head in a July 9 hearing, when Binance lawyers said they had interpreted Judge Amy Berman Jackson’s June 28 ruling on Binance’s motion to dismiss the SEC case as a move of third-party tokens out of the case, CoinDesk previously reported. The judge made it clear that this was not his intention.
Third-party tokens are digital assets issued by various companies other than Binance that have been listed by the crypto exchange. The 10 tokens named in the complaint are SOL, ADA, MATIC, FIL, ATOM, SAND, MANA, ALGO, AXS, and COTI. The SEC said these tokens are unregistered securities.
Tuesday’s filing was a joint court-ordered response to both sides’ positions on how to proceed further. It was expected that the judge would address what role third-party tokens might play in the SEC’s ongoing case against Binance. Instead, the SEC appears to have reversed its stance and now intends to drop that part of its charges.
This development led the defense to want to see the amended complaint before allowing the preliminary investigation phase.
“Until defendants have before them a set of proposed amended charges, it is premature and unreasonable for the SEC to expect them to agree to conduct a substantive investigation of claims for which the SEC may soon seek leave to amend its charges,” the document reads.