SEC ‘regrets’ confusion caused by stating some tokens are securities
The U.S. Securities and Exchange Commission (SEC) has amended its complaint against Binance in Washington, D.C., by introducing procedural updates and legal amendments to the original filing.
The amendments approved this morning include a motion under Rule 15(a)(2) of the Civil Procedure Rules, along with a memorandum explaining the changes, a revised complaint proposal, and a redlined version highlighting the changes.
Paul Grewal, Coinbase’s chief legal officer, commented on the SEC’s amended complaint on social media. He highlighted footnote 6 of the amended complaint, saying, “The SEC regrets the confusion caused by repeatedly falsely stating that the tokens themselves are securities.” He questioned the SEC’s longstanding position, saying:
“It is clear from the SEC’s long track record of regulation through enforcement campaigns that it absolutely ‘maintains’ that tokens themselves are securities. Why mislead the courts?”
Grewal shared portions of the complaint that clearly outline what the SEC regrets.
Grewal also commented on the SEC’s approach to Ethereum (ETH) transactions, noting a lack of clarity on how ETH transactions meaningfully change compared to other digital assets the agency is reviewing.
He said this.
“Somehow the ETH transactions managed to escape the agency’s grasp in a meaningful way that Ten Crypto Assets did not. How? That’s for the SEC to figure out, the rest of us only have to find out when we get sued.”
As per the amended complaint, this filing references additional documents, including an order denying Defendants’ motion to dismiss in the related case, SEC v. Payward, Inc. (Kraken). Procedural deadlines have been set, with Binance and co-defendants having until October 11 to respond by opposing the SEC’s motion or filing a notice of motion.
Legal analysts suggest that the SEC’s proposed changes could be an attempt to bolster its position amid criticism over regulatory clarity. The agency has faced ongoing scrutiny from industry participants who claim enforcement actions lack transparent guidance on what constitutes a security in cryptocurrencies.
Binance has been under regulatory pressure from the SEC, which claims the platform operates an unregistered securities exchange and misled investors. The exchange has consistently denied these claims, insisting on its commitment to compliance and cooperation with regulators.
The deadline for Binance and its co-defendants to respond to the SEC’s amended complaint sets the stage for a serious legal battle ahead of the U.S. elections, and as cryptocurrency regulation becomes increasingly important.
There is a growing demand for regulatory clarity across the industry, with many calling for definitive guidelines rather than enforcement measures as the primary means of regulation.
