The US Securities and Exchange Commission (SEC) on May 29, 2025 dismissed its civil lawsuit against cryptocurrency exchange Binance. The lawsuit included allegations of inflated trading volumes, use of customer funds, along with other regulatory compliance. Early in June 2023, the SEC had sued Binance and its founder, Changpeng Zhao, on multiple charges of inflating trading volumes, diverting customer cash, and deceiving investors about its surveillance mechanisms. Binance was charged also with unlawfully facilitating trading of several cryptocurrency tokens that SEC officials under then US President Joe Biden’s administration considered should have been registered as securities.
Binance Lawsuit Dismissed: Two Years On, US SEC Dismisses Lawsuit Against Binance, Exchange Says It's A Victory For Crypto
The US SEC has officially dismissed its lawsuit against Binance, bringing an end to the nearly two-year legal proceedings
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Zhao was convicted of breaching anti-money laundering regulations and completed a four-month sentence before being released in September 2024.
SEC Statement on Dismissal of Binance Lawsuit
The SEC said in its filing that the decision to dismiss the lawsuit was made “in the exercise of its discretion and as a policy matter.” It further clarified that the dismissal should not be interpreted as the Commission's stance on any other ongoing legal matters or cases.
The dismissal of the lawsuit effectively means that the SEC cannot reopen the case.
Binance Hails SEC Case Dismissal as Win for Crypto
Binance said the dismissal is a significant win for the cryptocurrency sector.
In a statement on X (previously Twitter), Binance praised SEC Chairman Paul Atkins and the Trump administration for resisting “regulation by enforcement”, adding that the decision marks a positive step forward for the US in the crypto sector.
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Edul Patel, co-founder and CEO of Mudrex said the dismissal of the lawsuit signals shifting regulatory attitudes toward crypto.
He says: “The dismissal of the civil case against Binance marks the end of one of the last major SEC enforcement actions in crypto. This shows a shift away from ‘regulation by enforcement’ towards clearer and more collaborative policymaking.”
He added: “Ongoing efforts like the SEC’s Crypto Task Force suggest regulators are working to build a defined framework for crypto platforms, aiming for greater transparency, accountability, and stronger investor protection.
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