Binance and its CEO search dismissal of CFTC grievance

(Reuters) -Binance and its CEO Changpeng Zhao have filed a movement to dismiss a grievance in opposition to the cryptocurrency change by the U.S. Commodity Futures Buying and selling Fee (CFTC), the corporate stated in a court docket submitting on Thursday.

The CFTC sued Binance, Zhao and former Chief Compliance Officer Samuel Lim in March, alleging they violated the Commodity Change Act and sure associated federal rules, and for working what the regulator stated was an “unlawful” change and a “sham” compliance program.

Binance, the world’s largest cryptocurrency change, stated the CFTC’s case ought to be dismissed as a result of it sought to control overseas people and companies that reside and function exterior the USA.

It additionally quoted a 2007 ruling that acknowledged: “United States regulation governs domestically however doesn’t rule the world.”

The holding firm of Binance is predicated within the Cayman Islands, whereas CEO Zhao is a Canadian citizen.

The CFTC’s grievance stated that from at the least July 2019, Binance “provided and executed commodity derivatives transactions on behalf of U.S. individuals” in violation of U.S. legal guidelines.

In its reply, Binance stated that by June 2019, Binance.com had begun implementing steps to limit and off-board potential U.S. customers and make sure that new customers weren’t U.S. individuals.

“Importantly, Binance.com didn’t start to supply the alleged digital asset spinoff merchandise till July 2019 and later —after it started to limit and off-board potential U.S. customers,” the corporate stated.

Lim filed a separate movement to dismiss the CFTC claims in opposition to him.

The CFTC, which is answerable for the oversight of commodities and derivatives markets, together with , declined to touch upon the submitting.

Binance and Zhao have been additionally sued by the U.S. Securities and Change Fee (SEC) in June for allegedly working a “net of deception,” itemizing 13 fees in opposition to Binance, Zhao and the operator of its purportedly impartial U.S. change.