The submission follows a three-month delay requested by both parties, who pointed to the potential influence of the SEC Crypto Task Force in advancing and resolving the case.
On May 29, the U.S. Securities and Exchange Commission (SEC) filed a four-page motion in District Court, asking a federal judge to dismiss its civil lawsuit against Binance and founder Changpeng ‘CZ’ Zhao.
In February, Judge Amy Berman Jackson granted a 60-day pause in the case after both parties informed the court that the newly formed SEC crypto task force, headed by Commissioner Hester Peirce, could influence and aid in resolving the litigation.
The stay on discovery deadlines was suspended by the decision, as the task force undertook a review to determine whether current securities regulations were applicable to digital-asset platforms.
That review took place while Binance remained in compliance with a prior consent order, which mandated increased transparency regarding custodial practices and the separation of U.S. customer assets.
Binance called the decision a “huge win for crypto” in a statement via X, adding:
The SEC’s case against us is dismissed. Thank you to Chairman Atkins & the Trump team for pushing back against regulation by enforcement. U.S. innovation is back on track – and it’s just the beginning.
SEC Drops Legal Case Against Binance
The filing declares that all causes of action against each defendant are “hereby dismissed” by the Commission.
The notice makes no mention of a monetary settlement, and it remains unspecified in the document whether the dismissal is with or without prejudice.
Since no counterclaims were filed by the defendants, the suit may be unilaterally withdrawn by the agency under Federal Rule 41(a)(1)(A)(i). The matter is expected to be formally concluded once the clerk processes the notice and Judge Jackson signs off on it.
Although the SEC has concluded this case, Binance.US is still bound by the consent decree, which requires periodic compliance reports every quarter and independent audits of its custodial wallets. If enforcement actions arise in the future, a separate complaint would need to be initiated.
The docket is anticipated to be closed by the court upon receipt of the dismissal notice, thereby officially ending the two-year legal dispute involving the Securities and Exchange Commission against Binance Holdings Ltd., BAM Trading Services Inc., and Changpeng Zhao.
Exchange Framework Challenged in SEC Complaint
The original action was initiated by the SEC in June 2023. Investigators claimed that Binance and Binance.US operated as unregistered broker-dealers, securities exchanges, and clearing agencies.
The complaint claimed that trading volumes were inflated through wash trades, customer assets were funneled to market-making firms overseen by Zhao, and investors were misinformed about the effectiveness of surveillance systems intended to prevent manipulation.
Injunctive relief, disgorgement of profits, and civil penalties were sought by the agency.
Wrongdoing was denied by Binance, which contended that its digital asset offerings did not meet the criteria of securities under the Howey test, while asserting that its international operations lay beyond the regulatory reach of the SEC.
In November 2024, parallel criminal probes led by the US Department of Justice concluded, resulting in Binance entering a guilty plea to Bank Secrecy Act violations and consenting to a $4.3 billion settlement.
