In a recent development in the world of cryptocurrency regulation, the Philippines Securities and Exchange Commission (SEC) has clarified the timeline for its impending ban on Binance, one of the world's largest cryptocurrency exchanges. During a panel discussion on Dec. 13, Kelvin Lee, the head of the Philippines SEC, revealed that the ban, initially issued as an advisory on Nov. 28, will officially take effect three months from the advisory's issuance date. This announcement comes after widespread confusion and speculation about the regulatory actions taken against Binance, which has been accused of operating without a proper license in the Philippines. As the countdown to the ban begins, the Philippines SEC is closely monitoring the situation and emphasizing the importance of regulatory compliance.
Meanwhile, In the ongoing legal battle between Binance Holdings and the United States SEC, new developments have emerged as Binance strongly opposes the SEC's attempt to introduce Binance's admission of guilt to the Department of Justice (DOJ) into its legal proceedings. The SEC's move to include the $4.3 billion guilty plea and settlement agreement in its case has been met with resistance from Binance. This legal dispute dates back to June 2023 when the SEC accused Binance of multiple securities law violations. As the cryptocurrency exchange contests the SEC's procedural approach, the outcome of this case holds significant implications for the future of cryptocurrency regulation in the United States and beyond.
Philippines SEC Announces Three-Month Countdown to Binance Ban, Promoting Regulatory Compliance
In a recent panel discussion on Dec. 13, the head of the Philippines SEC, Kelvin Lee, clarified the timeline for the impending ban on Binance, one of the world's largest cryptocurrency exchanges. The ban, initially issued as an advisory on Nov. 28, will officially come into effect three months from the advisory's issuance date, as confirmed by Lee during the panel.
This announcement follows widespread confusion and speculation surrounding the regulatory actions taken against Binance after it was accused of operating without a proper license in the Philippines. Lee addressed these concerns, explaining that the ban's three-month countdown began on Nov. 29. He also hinted that the timeline could be extended depending on feedback and evolving circumstances but emphasized the need for regulatory compliance.
Lee elaborated on the decision to allow a three-month grace period, stating that the original recommendation was for a much shorter timeframe, including the possibility of just one week for transition. However, he opted for a more extended period, taking into account the upcoming Christmas holiday season. "Not to make it hard for Filipino investors during that time," Lee emphasized.
In addition to Binance, Lee revealed that OctaFX and MiTrade, two other cryptocurrency exchanges recently issued advisories for operating without proper registration, will also face bans following the same three-month timeline. The Philippines SEC has noted a substantial list of unregistered exchanges operating in the country, suggesting that more advisories may be issued in the future.
Lee defended the regulatory actions against Binance and other unregistered exchanges, responding to criticism regarding their relatively lower fees compared to registered entities. He explained that registered exchanges incur compliance costs, ensuring they adhere to the necessary regulations for consumer protection. "Of course, they are cheaper because they never bothered to register in the Philippines and bothered to comply," Lee emphasized.
In his message to local investors, Lee stressed the importance of choosing registered entities for cryptocurrency transactions. Currently, there are 17 virtual asset service providers registered in the Philippines, offering fiat-to-crypto services while complying with the country's regulations. Lee emphasized that registration is essential to safeguard consumers and promote a healthy cryptocurrency ecosystem within the Philippines.
The SEC's move to enforce regulations on cryptocurrency exchanges is part of the broader effort to protect investors and ensure a level playing field for all participants in the crypto market. As the three-month countdown to the Binance ban begins, the SEC will closely monitor the situation and the response of other unregistered exchanges to the regulatory actions taken.
Binance Responds to SEC's Attempt to Include DOJ Settlement in Legal Proceedings
Binance Holdings and its former CEO, Changpeng Zhao, have reacted strongly to the United States SEC’s recent move to include Binance's admission of guilt to the Department of Justice (DOJ) in its ongoing legal proceedings. In a legal filing submitted on Dec. 12, Binance challenged the SEC's attempt, asserting that it was procedurally incorrect and should not be permitted.
The legal saga between Binance and the SEC began on Jun. 5, 2023, when the regulatory agency accused the cryptocurrency exchange of 13 securities law violations. These allegations included claims that Changpeng Zhao and Binance managed customer assets on Binance.US, mixed or redirected customer assets, and operated in violation of U.S. securities laws.
In November, the DOJ reached a separate settlement with Binance and its former CEO, effectively resolving the federal probe into the company's activities. As part of the agreement, Binance agreed to pay $4.3 billion in penalties and committed to continue its operations while complying with U.S. regulations.
While the SEC was not a formal party to the DOJ settlement, it argued that the federal court overseeing its case against Binance should consider the statements and acknowledgments made by Binance and Zhao in the Nov. 21 settlement. The SEC contended that these settlements underscored Binance's awareness of its U.S. operations, its service to U.S. customers, and its utilization of U.S. infrastructure for transactions.
In response, Binance has vehemently opposed the SEC's efforts to introduce the DOJ settlement into the ongoing legal proceedings. The exchange argued that the SEC failed to demonstrate how the resolutions reached with the DOJ were relevant to the SEC's allegations against Binance Holdings and Zhao.
In a statement submitted in court on Dec. 12, Binance asserted, "The SEC Notice is an impermissible supplemental brief that identifies no new 'authority' and instead attempts to introduce new factual information and arguments. This alone is reason to disregard it."
Binance further emphasized that presenting a judicial notice should not serve as a substitute for amending the complaint. The company accused the SEC of attempting to leverage settlements with other agencies as a sign of the SEC's lack of a clear regulatory approach and authority in this matter.
The legal wrangling between Binance and the SEC continues to attract significant attention within the cryptocurrency community and the broader financial sector. The outcome of this case is expected to have far-reaching implications for the regulation of digital asset exchanges in the United States and may set important precedents for the industry's future. As the legal battle unfolds, both Binance and the SEC are preparing for what could be a protracted and complex legal struggle.
