SEC Seeks Dismissal of Binance Lawsuit as It Shifts Toward New Crypto Regulatory Strategy

In a notable shift in its approach to crypto regulation, the U.S. Securities and Exchange Commission (SEC) has moved to dismiss its lawsuit against Binance, one of the world’s largest cryptocurrency exchanges. The agency filed a joint stipulation on Thursday with attorneys representing Binance and its former CEO Changpeng Zhao, requesting the dismissal of the case in the U.S. District Court for the District of Columbia.

The SEC explained in the filing that “in the exercise of its discretion and as a policy matter, the Commission believes the dismissal of this litigation is appropriate.” The case had been in limbo for months, with both parties repeatedly asking the court for delays since February.

Originally filed in 2023, the SEC lawsuit accused Binance of operating an unregistered exchange and misleading investors about internal trading controls. That same year, Binance and Zhao settled separate charges with the U.S. Department of Justice, pleading guilty to Bank Secrecy Act violations and agreeing to pay over $4 billion in penalties.

While the SEC declined to provide further comment on the dismissal, it emphasized that the decision “does not necessarily reflect the Commission’s position on any other litigation or proceeding.”

Binance welcomed the move, calling it “a landmark moment.” In a statement, the company expressed gratitude to former SEC Commissioner Paul Atkins and the Trump administration for recognizing the importance of regulatory clarity over punitive enforcement. “Innovation can’t thrive under regulation by enforcement,” the spokesperson said.

The court filing also referenced the formation of the SEC’s new crypto task force, which has been actively meeting with industry stakeholders in recent months. The task force is part of a broader pivot in how the agency plans to engage with the digital asset space, moving away from the aggressive enforcement tactics favored under former Chair Gary Gensler and the previous administration.

This latest dismissal follows a string of dropped SEC cases involving major crypto players such as Coinbase, Uniswap, and OpenSea. Despite these rollbacks, the agency has made it clear that enforcement is not off the table.

Speaking at the Bitcoin 2025 conference in Las Vegas, SEC Commissioner Hester Peirce underscored that the shift doesn’t mean crypto firms are free to ignore rules.

“The goal is to use our enforcement tool for what it was intended to be used for—when there are clear rules and people violate them,” she said.

Peirce has long advocated for a more constructive approach to crypto oversight and was openly critical of the agency’s earlier stance.