- Judge Jackson’s ruling to dismiss the SEC’s claims against BNB’s secondary sale has clarified the secondary sale of crypto assets.
- The ruling hints at the potential victory for exchanges like Kraken and Consensys against the SEC.
- Scott Johnsson acknowledges the ruling as a “big loss” for the SEC.
In a significant legal victory for Binance, a federal judge has ruled that secondary market sales of its BNB token do not constitute securities. The decision could have far-reaching implications for the regulatory landscape surrounding cryptocurrencies and their trading.
Fox Business journalist Eleanor Terrett, in her post on X (formerly Twitter), highlighted the significance of Judge Jackson’s ruling as a “big win” for the crypto industry.
In the latest development, the court decided to proceed with most of the charges against Binance, as the exchange failed to clarify its arguments to Judge Jackson. However, the judge dismissed SECs’s secondary sale charges, citing Judge Analisa Torres’ ruling on Ripple’s XRP.
Specifically, in July 2023, Judge Torres ruled that XRP sales on exchanges, sales by Ripple executives, and distributions to developers, charities, and employees do not constitute securities.
Judge Jackson, in the recent ruling, argued that the government’s claim that “crypto assets are the embodiment of the investment contract” is insufficient to “bring secondary sales of BNB under the investment contract rubric.” The judge added:
“Moreover, the agreement is somewhat inconsistent with the singular theory the government has been advancing since this action was filed: we aren’t saying that the coins are securities – we are talking about investment contracts.”
Prominent figures like Scott Johnsson have weighed in on the development, with Johnsson acknowledging the ruling as a “big loss” for the SEC.
In a subsequent post, Terrett hinted at a potential win for crypto platforms like Coinbase, Kraken, and Consensys in their respective fights against the SEC. She highlighted that the lawyers of these platforms could use Judge Jackson’s ruling “to bolster their positions in their own litigations.” She also asserted that Judge Torres’ XRP ruling could no longer be disputed.
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