#SECGuidance 1. SEC Lawsuit Against Binance (June 2023)**

- The SEC **sued Binance, Binance.US, and founder Changpeng Zhao (CZ)** for allegedly operating unregistered securities exchanges, broker-dealers, and clearing agencies.

- **Key Allegations:**

- Offering and selling unregistered securities, including **BNB (Binance Coin)** and **BUSD (Binance USD)**.

- Failing to register **staking-as-a-service** programs (similar to the SEC’s case against Kraken).

- Commingling customer funds and diverting them to a separate entity, **Sigma Chain**, controlled by CZ.

- Allowing U.S. customers to trade on **Binance.com** despite restrictions.

**2. SEC’s Position on Binance-Listed Tokens as Securities**

- The SEC classified several tokens traded on Binance as **unregistered securities**, including:

- **BNB** (Binance Coin)

- **BUSD** (Binance USD stablecoin)

- **SOL** (Solana)

- **ADA** (Cardano)

- **MATIC** (Polygon)

- **FIL** (Filecoin)

- **ATOM** (Cosmos)

- **SAND** (The Sandbox)

- **MANA** (Decentraland)

- **ALGO** (Algorand)

- **AXS** (Axie Infinity)

- This aligns with the SEC’s broader stance that many cryptocurrencies qualify as **investment contracts** under the **Howey Test**.

**3. Settlement with Binance and CZ (November 2023)**

- While the **SEC’s case is ongoing**, Binance reached a **$4.3 billion settlement** with the **U.S. Department of Justice (DOJ)**, **CFTC**, and **Treasury Department** for **anti-money laundering (AML)** and **sanctions violations**.

- **CZ pleaded guilty** to AML violations and stepped down as CEO. He faces potential prison time.

- The **SEC’s case remains separate**, with possible further penalties.