Binance and the United States Securities and Exchange Commission (SEC) have asked a federal judge to stay the regulator’s lawsuit against the crypto exchange, according to a court filing, citing the potential impact of a newly launched task force.
The motion to request a stay for 60 days marks the first clear effort to retreat from the SEC’s previous crypto enforcement under Democratic leadership.
In a joint motion filed late on Monday, the parties said the SEC’s task force, formed last month to work on crypto regulations, may “impact and facilitate the potential resolution of this case”.
The stay was seen by some as an early sign of the SEC’s pivot to a more crypto-friendly stance, reflecting President Donald Trump’s pledge to make the US a global hub for the industry.
The SEC, under Republican leadership, was expected to begin a review of existing court cases like those against Binance, where the regulator has argued the firms are listing crypto tokens that behave like securities.
A spokesperson for the agency declined to comment beyond the court filing.
At an event of the Federalist Society for Law and Public Policy Studies, a conservative and libertarian legal organisation, on Tuesday, Republican SEC Commissioner Hester Peirce said: “We’ve been approaching it backwards, using our enforcement division to set policy.”
‘SEC’s shift on crypto’
The SEC regulator sued Binance in June 2023, as well as its US unit and founder Changpeng Zhao, accusing them of artificially inflating trading volumes, diverting customer funds and misleading investors about its market surveillance controls.
“The SEC’s case has always been without merit, and we are eager to put this behind us and to continue our focus on keeping Binance the most secure, licensed and trusted exchange in the world,” a spokesperson for Binance said, while thanking acting SEC Chair Mark Uyeda.
Former SEC official Corey Frayer criticised the stay.
“Delaying a case where the CEO pled guilty to criminal charges and the SEC has an employee dead to rights admitting violation of the securities laws clarifies the SEC’s shifts on crypto may culminate in a full dereliction of duty,” he told Reuters.
Separately, Binance in November 2023 admitted to violating a law designed to prevent money laundering, and Zhao served time in prison for a related charge.
But the US government has made a sharp turnaround on crypto since Trump took office. The president has tapped crypto-friendly Washington, DC lawyer Paul Atkins as the new chair of the SEC.
Atkins has yet to be confirmed by Congress, but the SEC has already started shifting priorities under its existing Republican leadership, reassigning some of its crypto enforcement lawyers to other areas and tightening oversight of investigations.
The SEC’s prior chair, Gary Gensler, had asked Congress to help the agency rein in the crypto “Wild West”.
SEC’s Peirce, on Tuesday, noted that the comparison with the Wild West has “positive sides” and that regulators need to regulate the industry and protect investors in a way that “recognizes the greatness of that American spirit that moved west”.
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