Binance along with its founder Changpeng Zhao as well other associated companies plan to move to dismiss a case filed in March by the US Commodity Futures Trading Commission.
According to documents filed Monday, their motion for dismissal — due by Thursday — will come in excess of a 15-page limit allowed by default, so they’ve requested permission to lodge a longer document.
Binance is accused by the CFTC of conducting commodity derivatives trading on behalf individuals in US from July 2019.
The regulator claims that Binance, and its top executives including the former Chief Compliance Officer Samuel Lin, intentionally ignored regulations in order to conceal their operations.
Document states that the CEO Zhao, along with foreign Binance entity representatives, intend to join forces to make a joint motion for termination, while Lim will file his own motion. Lim will also join parts of the motion brought forth by Zhao, the Binance foreign entities.
“Defendants’ alleged willful evasion of US law is at the core of the Commission’s complaint against Binance,” Gretchen Lowe was the chief lawyer of CFTC’s Enforcement Division in March. “The defendants’ own emails and chats reflect that Binance’s compliance efforts have been a sham and Binance deliberately chose — over and over — to place profits over following the law.”
Zhao responded initially to the accusations in a post on his blog, saying that the lawsuit contained an “incomplete recitation of facts” Refuting the “characterization of many of the issues alleged in the complaint.”
Binance.US volume dwindles amid CFTC, SEC lawsuits
Binance, the holding company that is behind the exchange, has its headquarters registered on the Cayman Islands. However the exchange claims it does not have an official office.
Binance.US is still a US-centric platform, but it does not offer any derivatives, such as futures contracts or margin trading. After recent US agency cases, Binance.US is struggling to retain banking partners.
Binance’s US exchange processes a fraction of the trade volume reported by the global platform — just $11.5 million over the past day compared to $7.1 billion, according to CoinGecko. Binance.US processed more than $100 million per day in the first few months of 2018.
The CFTC lawsuit referred back to informal internal discussions that discussed how US users might circumvent Binance’s KYC (customer identification process) and gain access to its flagship exchange.
Separately, SEC has filed a lawsuit claiming multiple breaches of the securities laws, such as unregistered sale, customer funds commingling and washing trading.
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