Binance and CEO CZ seeks dismissal of CFTC lawsuit

Key Points:

• Binance and CZ seek the dismissal of the CFTC lawsuit over cryptocurrency derivatives activities, which has implications for the entire crypto industry.
• Binance faces lawsuits from multiple regulators, underscoring the increasing regulatory scrutiny of the crypto industry.

Lawyers representing Binance and CEO Changpeng “CZ” Zhao have filed statements supporting the dismissal of CFTC lawsuit in March.

Binance and CZ support in the dismissal of CFTC lawsuit

CZ and Binance’s legal representatives argued for the dismissal of CFTC lawsuit against the exchange in a filing to the U.S. District Court for the Northern District of Illinois. They claimed that if the court upheld the regulator’s arguments, it would grant the CFTC global authority over cryptocurrency derivatives activities.

The filing stated, “Congress did not designate the CFTC as the world’s derivatives watchdog, and the Court should reject the agency’s attempt to extend its jurisdiction beyond the limits established by the law.”

Binance and CZ Urge Court to Dismiss CFTC Lawsuit with Prejudice

The lawyers representing Binance and CZ also scrutinized each of the specific charges brought by the CFTC, asserting that the regulator’s anti-evasion claim was based on an unconventional theory and that it had failed to meet the required standards in other aspects. They urged the court to “dismiss the complaint with prejudice.” The CFTC’s lawsuit, filed in March, alleged that Binance had violated rules governing derivatives trading by failing to register with the regulator. According to the CFTC, CZ was aware of Binance’s solicitation of U.S.-based customers, making it necessary for the exchange to comply with regulatory mandates.

Binance’s legal team had previously filed a similar motion in dismissal of CFTC lawsuit in July, arguing that the CFTC had exceeded its regulatory boundaries. It is worth noting that the crypto exchange is also facing a lawsuit from the U.S. Securities and Exchange Commission, filed in June.

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