A federal judge in Washington, D.C., has temporarily halted the U.S. SEC civil lawsuit against Binance.
The decision, issued on Thursday by U.S. District Judge Amy Berman Jackson, grants a 60-day pause following a joint request from the SEC and Binance, Reuters reported.Â
Binance and SEC Lawsuit Agreed to be Put On Hold
Both parties agreed to reevaluate the case instead of moving forward with legal proceedings. At the end of this period, they will submit a report outlining the next steps, including whether an extension is necessary or if alternative solutions can be explored.
The delay comes after the SEC established a new cryptocurrency task force last month, which could influence the direction of the case. Commissioner Hester Peirce, a known advocate for the crypto industry, leads the task force.
Peirce has been vocal about the need for balanced regulation that fosters innovation while protecting investors.
Background of the Case
The SEC initially filed a lawsuit against Binance and its founder, Changpeng Zhao, in June 2023. The regulator accused the exchange of manipulating trading volumes, misusing customer funds, and misleading investors regarding its security measures.
The lawsuit was part of the SEC’s broader crackdown on the cryptocurrency industry, aimed at imposing stricter regulations on digital asset firms operating in the U.S.
The legal action against Binance came at a time when regulators were scrutinizing major crypto platforms over compliance issues. The SEC’s chair, Gary Gensler, has frequently described the industry as a “Wild West,” pushing for greater oversight to curb fraudulent activities and protect investors.
Also Read: Binance and CZ File Motion to Dismiss SEC’s Amended Lawsuit Over Regulatory Clarity
Political Developments and Future Implications
The decision to pause the case aligns with recent shifts in U.S. cryptocurrency policy. Former President Donald Trump, who is seeking another term in office, has pledged to make the U.S. a leading hub for the crypto industry.
He has nominated Paul Atkins, a pro-crypto Washington lawyer, to replace Gary Gensler as SEC chair if he wins the election. Atkins is expected to take a more industry-friendly approach to regulation, potentially reshaping the SEC’s stance on digital assets.
With political changes on the horizon, the SEC’s aggressive enforcement strategy could face challenges. The new task force’s review of crypto regulations may lead to revised policies, which could impact ongoing lawsuits, including the one against Binance.
Industry experts believe that if the SEC softens its approach, companies like Binance might be able to negotiate settlements rather than facing lengthy legal battles.
What’s Next?
Over the next 60 days, Binance and the SEC will assess the case and consider possible resolutions. This pause offers Binance some breathing room, allowing the company to navigate regulatory challenges while the industry awaits potential shifts in enforcement policies.
After 60 days, both parties will submit a report to the court outlining whether further delays are necessary or if a resolution is within reach. The outcome could set a precedent for other cryptocurrency firms facing regulatory scrutiny in the U.S.
Also Read: Binance Security Team Helped To Track Down $243M Crypto Heist