Binance and CEO Changpeng Zhao Prepare to Challenge CFTC Complaint with Dismissal Petition

Binance, one of the world’s largest cryptocurrency exchanges, along with its CEO, Changpeng “CZ” Zhao, is preparing to take on the United States Commodities Futures Trading Commission (CFTC) by filing a motion to dismiss the lawsuit brought against them.

In a recent filing to an Illinois District Court on July 24, multiple entities associated with Binance, including CZ and former Chief Compliance Officer Samuel Lim, stated their intention to submit two separate motions seeking the dismissal of the complaint. The filing indicated that the Foreign Binance Entities and Zhao plan to jointly file a Motion to Dismiss, while Lim will submit a separate motion, incorporating certain aspects from the joint filing.

Moreover, Binance has requested permission to exceed the typical 15-page limit for its brief in support of the dismissal motion. The exchange is seeking to expand the limit to 50 pages, citing the complexity of the CFTC’s lawsuit, which was filed in March of that year.

The CFTC’s lawsuit alleges that Binance failed to register properly with the regulator. Despite blocking U.S. residents from using its platform, the CFTC claims that Binance knowingly conducted transactions in various cryptocurrencies for individuals based in the U.S. The regulator further accused Binance of intentionally violating U.S. laws and described the exchange’s compliance process as a “sham.” It also alleged that Binance purposefully conducted its operations outside the U.S. to evade regulatory scrutiny.

In addition to the CFTC’s lawsuit, the Securities and Exchange Commission (SEC) also sued Binance and Zhao on June 5, claiming that the exchange sold unregistered securities and permitted U.S. customers to use its global platform. The SEC’s complaint further accused Zhao of misusing customer funds.

Amidst these legal challenges, reports suggest that Binance is under investigation by the U.S. Department of Justice (DOJ) for allegedly allowing Russian users to utilize its platform in violation of U.S. sanctions.

Both Binance and the CFTC were contacted for comment, but no immediate response was received at the time of reporting.

The legal battles and investigations have thrust Binance into the spotlight, raising questions about the exchange’s compliance practices and its operations within the United States. As the case develops, the crypto industry closely watches how Binance and its CEO will address the allegations and seek to protect their interests in the U.S. market.

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