SEC intends to amend Binance complaint, removing need for ruling on whether tokens are securities 'at this time'

The U.S. Securities and Exchange Commission intends to seek an amendment to its original complaint against crypto exchange Binance — potentially impacting the need for a court ruling on whether or not tokens such as Solana SOL -4.54% are securities — a Monday filing showed.

In a joint status report submitted on Monday, the SEC said that it hopes to amend its complaint. “The SEC informed Defendants that it intends to seek leave to amend its Complaint, including with respect to the ‘Third Party Crypto Asset Securities’ as defined in the SEC’s Omnibus Opposition to Defendants’ Motion to Dismiss, Dkt. No. 172, obviating the need for the Court to issue a ruling as to the sufficiency of the allegations as to those tokens at this time,” the SEC wrote.

The SEC filed the omnibus opposition in November, where it alleged that the third-party crypto asset securities — namely SOL, ADA, MATIC +0.41% , FIL, ATOM, SAND, MANA, ALGO, AXS and COTI — were offered and sold as investment contracts on Binance’s platforms. The SEC claimed that these assets meet the Howey test , which defines sales of securities as investment contracts.

However, in the Monday filing, the SEC said it intends to amend its complaint to obviate the need for a court ruling “at this time.” 

The Monday filing was submitted in response to the court’s July 9 order requiring the SEC and Binance to meet, confer and file a joint submission by July 29 to set fourth the proposed schedule for further proceedings. The submission should include deadlines for any motion to amend the complaint, according to the minute order.

Binance said in the joint report that during the process of conferring with the SEC, the agency “represented for the first time that it intends to move for leave to file an amended complaint.” 

The SEC’s proposal “suggests that they intend amendments beyond the claims concerning the Third-Party Tokens,” Binance added.