Binance’s defense against SEC could be aided by Mango Markets case Binance’s defense against SEC could be aided by Mango Markets case
Government arguments that helped convict Avraham Eisenberg could benefit Binance in an unrelated securities case.
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Updated: Apr. 27, 2024 at 1:03 am UTC
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Binance could strengthen its defense against the US Securities and Exchange Commission (SEC) by drawing on an unrelated case.
On April 26, Binance and related parties filed a government document from an unrelated case against Mango Markets exploiter Abraham Eisenberg, who was convicted by a jury on April 18.
The government’s argument
Binance’s defense team drew attention to a specific paragraph in which the US government expressed its position on whether a particular stablecoin, USDC, is a security.
On behalf of the US government, attorney Damian Williams stated that there “is no factual basis for treating USDC as a security,” adding that “holders of USDC do not expect profits from the token” because of its ties to the US dollar.
The argument closed off a possible exception that would prevent classifying MGNO Perpetuals, which are based on the value of USDC, as a mixed swap.
The argument aided government prosecutors in the Eisenberg case but could benefit defendants facing securities violations in other cases, such as Binance.
Limitations of the argument
The relevance of the case may have limits. The SEC has charged Binance with various securities violations, but each case focuses on different offerings.
Furthermore, the latest filing is only relevant to the SEC’s civil securities suit against Binance Holdings Limited, its former CEO Changpeng Zhao, and related companies. It does not pertain to a criminal case in which Zhao has pleaded guilty and awaits sentencing.
The Eisenberg case could also help defendants in other securities cases, including Coinbase, for similar reasons. The SEC initiated lawsuits against Coinbase and Binance just days apart in June 2023, and it has advanced various other suits against other exchanges, including Kraken in November 2023.
Mentioned in this article
Posted In: Legal
Author 
Mike Dalton
Before transitioning to crypto writing in 2018, Mike studied library and information sciences. Currently, he resides on Canada's West Coast.
Editor Editor 
Assad Jafri
AJ, a passionate journalist since Yemen's 2011 Arab Spring, has honed his skills worldwide for over a decade. Specializing in financial journalism, he now focuses on crypto reporting.
In this article
USD Coin (USDC) is a stablecoin fully backed by the US dollar and developed by the CENTRE consortium.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Changpeng Zhao, popularly known as “CZ,” is a notable figure in the cryptocurrency world, primarily for founding and leading Binance, the world’s leading cryptocurrency exchange by trading volume.
