Binance and SEC Clash in Court Over Crypto Regulation

Judge Amy Berman Jackson questions both parties on the application of the Howey test to Binance's tokens.

Binance, the world's largest crypto exchange, faced the Securities and Exchange Commission (SEC) in court on Monday, answering questions about why tokens traded on its platform should or should not be considered securities.
The SEC sued Binance and its former CEO Changpeng Zhao in June, accusing the crypto exchange of lying to customers, failing to restrict U.S. investors from accessing Binance.com, misdirecting capital to separated investment funds owned by Zhao, and operating as an unregistered exchange.
Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia pressed both sides about whether BNB, BUSD and other assets traded on Binance meet or don't meet the criteria of the Howey test – a set of parameters used by the SEC to determine whether an asset is a security or not.
Binance's defense team argued that secondary sales happening on Binance do not pool funds which are then invested in a common enterprise, one of the criteria for the Howey test.
The SEC's case against Binance differs from the one against its rival Coinbase as it also includes allegations of fraud and market manipulation.