According to a Freedom of Information Act (FOIA) filing by CoinDesk, Binance has not been subpoenaed by the US Securities and Exchange Commission (SEC).
An SEC FOIA officer wrote,
“Based on the information you provided in your letter, we conducted a thorough search of the SEC’s various systems of records, but did not locate or identify any information responsive to your request.”
This means that no valid subpoena could have been used to compel Binance to turn over information. This includes making witnesses accessible for interrogation.
Additionally, at CoinDesk’s Consensus 2022 conference in June, CEO Changpeng Zhao, CZ, stated that Binance regularly communicates with law enforcement. Furthermore, he refuted any claims that the business had received a subpoena.
Although the FOIA came back with no relevant documents, an active investigation into Binance could allow the SEC to withhold documents. This is possible under exemption 7, which prohibits document release as it could interfere with the proceedings. In such cases, the SEC’s reply is a typical glomar response, i.e., they cannot confirm or deny.
Is Binance’s BNB security? What does the SEC consider security?
In June of this year, CZ said that the SEC’s (Securities and Exchange Commission) inquiry is just the agency asking questions. The commission was looking into whether Binance’s BNB token is a security. Additionally, BNB does not offer equity in Binance; it should not, by definition, be considered a security.
Binance is also being investigated by the U.S. Justice Department, the Commodity Futures Trading Commission (CFTC), and the Internal Revenue Service.
Nonetheless, the SEC labeled nine crypto tokens as securities in its first insider trading case on Thursday. This is the first time the agency has declared multiple cryptos as securities. However, the commission has not charged the issuer or exchanges offering the tokens. Flexa’s AMP, RLY, DDX, XYO, RGT, LCX, POWR, DFX, and KROM are the tokens in question. However, the agency did not clarify nor answer questions if Thursday’s complaint is the blueprint of how the SEC would label securities.
The SEC stated,
“Each of the nine companies invited people to invest on the promise that it would expend future efforts to improve the value of their investment.”