SEC Seeks to Amend Complaint Against Binance, Potentially Delaying Token Rulings

• SEC plans to amend its Binance complaint, potentially delaying the ruling on token securities.
• The amendment could impact immediate court decisions on tokens like Solana, ADA, and MATIC.
• Binance notes SEC’s proposed changes might extend beyond third-party tokens in legal adjustments.

The U.S. Securities and Exchange Commission (SEC) has filed a motion to amend its complaint against Binance. This move could alter the need for an immediate court decision on whether certain tokens, including Solana (SOL), are classified as securities. The SEC’s intention to adjust the complaint was revealed in a recent court filing, suggesting a shift in its legal strategy.

The SEC’s initial complaint claimed that several tokens, including Solana (SOL), Cardano (ADA), and Polygon (MATIC), were securities. The SEC argued that these tokens fit the definition of investment contracts according to the Howey test, a legal standard for determining if something is a security. However, the SEC now wants to update its complaint, which might delay the decision on whether these tokens are securities.

In a joint status report submitted Monday, the SEC indicated its desire to seek leave to amend the complaint. The filing noted that the amendment would address the “Third Party Crypto Asset Securities” discussed in the SEC’s previous omnibus opposition to Binance’s motion to dismiss. This adjustment could potentially eliminate the need for the court to immediately resolve whether the mentioned tokens are securities.

The SEC’s amendment proposal follows a court order issued on July 9, which required both the SEC and Binance to submit a joint report by July 29. This report was intended to outline the proposed schedule for further proceedings and set deadlines for any amendments to the complaint. Binance, in its response, noted that this was the first indication from the SEC regarding its intent to file an amended complaint.

Binance has not disputed the SEC’s aim to amend the bill and might be expanded to involve more than only the third-party tokens. This change of events is a big shift in the legal tussle between the SEC and Binance, it might set the tone for future regulation of cryptocurrencies. 

The proposed change to the SEC’s complaint could delay a final decision on the status of different tokens. As the case moves forward, it will be important to watch how these legal changes might impact the regulation of cryptocurrencies and the overall crypto market.