SEC Dismisses Lawsuit Against Binance — WSJ

By Alexander OsipovichThe Securities and Exchange Commission dismissed its lawsuit against Binance and its billionaire founder Changpeng Zhao, the agency's latest move to wind down Biden-era enforcement actions against the crypto industry.The detailsIn a Thursday court filing, attorneys for the SEC, Binance and Zhao signed on to the agency's decision to dismiss the 2023 lawsuit. The filing noted that the SEC recently created a "crypto task force" aimed at crafting a new regulatory framework for digital assets, part of a broader effort by the Trump administration to create a friendlier environment for the industry."We're deeply grateful to Chairman Paul Atkins and the Trump administration for recognizing that innovation can't thrive under regulation by enforcement," a Binance spokeswoman said in a statement, referring to the SEC's new leader.The contextWhen the SEC sued Binance in June 2023, it was led by Gary Gensler, a Biden appointee who argued that the crypto markets were riddled with scams and needed to be subjected to the same laws that govern securities such as stocks and bonds. Gensler's SEC sued an array of big crypto firms, including Binance, the world's largest digital-currency trading platform.In its lawsuit, the SEC alleged that Binance operated unregistered securities exchanges, misrepresented trading controls and commingled investors' assets with company funds. Binance has always said the case was without merit.Binance separately pleaded guilty that year to violating U.S. anti-money-laundering rules and agreed to pay a $4.3 billion fine. Zhao served four months in jail on a related charge.The big pictureCrypto is riding high in the U.S. right now, boosted by the favorable regulatory environment. Bitcoin's price is up more than 50% since President Trump's election victory, after recently hitting a record high, and Vice President JD Vance addressed a cheering audience at a bitcoin conference this week.The SEC's dismissal of its Binance lawsuit is the latest sign that the Trump administration is focused on cooperating with the industry. It also comes as the president and his family have faced criticism over their private crypto business interests.The Wall Street Journal reported in March that Zhao had been seeking a pardon while representatives of the Trump family held talks to invest in the U.S. arm of Binance. Zhao and Binance denied the talks, although Zhao has confirmed seeking a pardon.Write to Alexander Osipovich at [email protected]