Binance Legal Proceedings Paused as SEC Forms Specialized Crypto Unit

TLDR

• Binance and the SEC have jointly filed a motion to pause their legal proceedings for 60 days, citing the potential impact of a newly formed SEC crypto task force led by Hester Peirce under Chairman Mark Uyeda’s leadership.
• The pause aims to conserve resources and explore early resolution opportunities, with both parties agreeing to submit a status report after 60 days to determine if an extension is needed.
• Last month, Binance and CEO Changpeng Zhao filed a motion to dismiss the lawsuit, arguing the SEC failed to demonstrate how their complaint meets the Howey test criteria.
• The SEC’s new crypto task force, launched in January 2025, has established an official website and plans to work on clarifying securities laws for digital assets.
• Industry experts suggest this development could influence other non-fraud crypto cases, including those involving Ripple, Coinbase, and Kraken.

The U.S. Securities and Exchange Commission (SEC) and cryptocurrency exchange Binance have agreed to temporarily halt their legal battle. Both parties filed a joint motion on February 10, 2025, requesting a 60-day pause in their court proceedings, marking a new phase in one of the crypto industry’s most watched cases.

The motion, filed in the U.S. District Court for the District of Columbia, comes after the recent appointment of Mark Uyeda as SEC Chairman. Under Uyeda’s leadership, the SEC has formed a new crypto task force headed by Commissioner Hester Peirce, known in the industry as “crypto mom” for her supportive stance on digital asset innovation.

The pause serves multiple purposes, according to the court filing. Both parties believe the task force’s work could help them reach a resolution without further court proceedings. They have agreed to submit a status report at the end of the 60-day period to determine whether they need more time.

This development follows Binance’s earlier attempts to end the legal battle. In January 2025, the exchange and its founder Changpeng Zhao (CZ) filed a motion to dismiss the case. They argued that the SEC had not shown how their complaint met the requirements of the Howey test, which determines whether an asset qualifies as a security.

The original lawsuit alleged that Binance operated as an unregistered securities exchange, broker, dealer, and clearing agency. The SEC also claimed that Binance misled investors about its risk controls and trading volumes, while concealing details about who operated the platform.

The case has faced several twists and turns. In June 2024, a federal judge dismissed the SEC’s argument that BNB tokens traded on secondary markets were securities, dealing a blow to part of the regulator’s case.

The newly established crypto task force represents a shift in the SEC’s approach to digital asset regulation. The unit now has an official website and aims to clarify how securities laws apply to digital assets. Their goals include developing practical policy measures that balance innovation with investor protection.

Fox Business journalist Eleanor Terrett suggests this pause could influence other ongoing crypto cases. Companies like Ripple, Coinbase, and Kraken, which face similar non-fraud charges from the SEC, might seek similar arrangements.

🚨NEW: Here’s the first requested pause on #crypto litigation in the courts since @MarkUyedaUS took over as acting chair. @binance and the @SECGov have just filed a joint motion to stay the agency’s case against the exchange for 60 days, citing the new SEC crypto task force as… pic.twitter.com/D2zcolMNC5

— Eleanor Terrett (@EleanorTerrett) February 11, 2025

Coinbase’s case mirrors some aspects of the Binance lawsuit. The SEC charged the company with operating as an unregistered securities exchange and failing to properly register its crypto staking program.

Ripple’s case, centered on the classification of its XRP token, continues at the Court of Appeals for the Second Circuit. The SEC appealed a July 2023 ruling that determined XRP sales to retail investors on exchanges did not constitute security transactions.

The task force plans to work with SEC staff and engage with the public as it develops new approaches to crypto regulation. This collaborative approach marks a change from the previous enforcement-focused strategy.

According to the joint motion, if an early resolution emerges during the pause, it would eliminate the need to address Binance’s pending motions to dismiss the amended complaint.

Both parties have emphasized resource conservation as a key reason for the pause. The temporary halt allows them to avoid potentially unnecessary court proceedings while the task force works on broader regulatory guidelines.

The court has yet to rule on the joint motion. If approved, the 60-day countdown will begin, during which both sides will monitor the task force’s progress and evaluate potential paths to resolution.

At the end of the pause, the SEC and Binance must inform the court about their progress and whether they need additional time. This deadline ensures the case maintains momentum while allowing for productive discussions.