- Binance executives file a motion to dismiss CFTC charges and request a new memorandum of law to present the exchange’s arguments.
- Binance’s motion reasoning is due July 27.
In its ongoing legal spar with the Commodity Futures Trading Commission (CFTC), Binance executives CZ and chief compliance officer Samuel Lim, on July 24, filed a motion to dismiss the charges brought against them.
The CFTC accused Binance of violating U.S. derivatives laws and alleged that the exchange offered its services to U.S. residents without proper registration.
The Motion to Dismiss
Binance and its executives seek to file a memorandum of law exceeding the typical 15-page limit to present their arguments against the CFTC’s allegations. A memorandum of law is a legal document submitted to a court by a party involved in a lawsuit.
It is a formal written argument that presents legal points and analysis to support the party’s position on a particular legal issue or motion. Judges use these memoranda to understand better the issues and the legal principles involved when making decisions during the trial.
Typically, a memorandum of law is limited to a specific number of pages per the court’s rules. For instance, courts normally impose a limit of 15 pages for a memorandum. However, in complex cases or when there are numerous legal arguments to be made, parties may request permission from the court to submit a longer memorandum, exceeding the standard page limit.
Binance argues that the complexity of the CFTC’s complaint and the number of arguments they anticipate making require additional space to address the issues effectively. Binance’s response to the CFTC complaints is due by July 27, and the regulator has not opposed the exchange’s request for an extension.
Allegations by the CFTC
The CFTC’s lawsuit against Binance is based on the exchange’s failure to properly register in the United States, violating U.S. derivatives laws. Furthermore, the regulator accused Binance of encouraging U.S. users to access its platform through a VPN.
Besides the CFTC and SEC lawsuits, Binance has encountered regulatory hurdles in multiple jurisdictions worldwide. This led the exchange to exit operations in several countries, including Canada, Netherlands, and Cyprus. The difficulties faced by Binance in various countries highlight the complexities of navigating global regulatory environments for cryptocurrency exchanges.
Conclusion
As Binance and its executives prepare to respond to the CFTC’s allegations, they remain steadfast in denying wrongdoing. Seeking dismissal of the charges and filing memoranda of law beyond the typical page limit allows them to present a comprehensive defense against the complex allegations.
The outcome of this legal battle may have significant implications for the cryptocurrency industry’s regulatory landscape and could shape how exchanges operate in the United States and globally.
