The United States Securities and Exchange Commission on Thursday voluntarily dismissed its civil lawsuit against Binance, the world’s largest cryptocurrency exchange, in a move seen as part of a broader shift in regulatory strategy under President Donald Trump’s renewed leadership.
A joint stipulation of dismissal, signed by attorneys for the SEC, Binance, and Binance founder Changpeng Zhao, was filed in federal court in Washington. The case was dismissed with prejudice, meaning it cannot be refiled.
The SEC stated that the dismissal was made “in the exercise of its discretion and as a policy matter,” and emphasized that it does not reflect a broader stance on other ongoing cryptocurrency-related litigation.
A spokesperson for Binance hailed the decision as a “landmark moment,” expressing gratitude to SEC Chairman Paul Atkins and the Trump administration for “recognizing that innovation can’t thrive under regulation by enforcement.”
The lawsuit, originally filed in June 2023, accused Binance and Zhao of inflating trading volumes, misusing customer funds, and misleading investors about internal compliance and surveillance systems. It also alleged that Binance facilitated the trading of tokens the agency under the previous administration classified as unregistered securities.
The civil case was separate from Binance’s high-profile guilty plea in November 2023, which resulted in a \$4.32 billion criminal penalty for violations of anti-money laundering and sanctions laws. Zhao, who pleaded guilty to related charges, served a four-month prison sentence and was released in September.
The Binance dismissal follows a similar move in February, when the SEC dropped an enforcement case against Coinbase, the largest U.S. cryptocurrency exchange, which had been accused of illegally trading unregistered securities.
These developments underscore a significant pivot in the SEC’s approach to crypto regulation. Under former SEC Chairman Gary Gensler during the Biden administration, the agency aggressively pursued enforcement actions against crypto firms. Chairman Atkins, appointed by Trump, has instead advocated for clearer regulatory frameworks and has scaled back many of these actions.
“The goal is to create a regulatory environment that supports innovation while targeting bad actors,” Atkins said earlier this month.
Despite the shift, enforcement hasn’t stopped entirely. On May 20, the SEC filed a lawsuit against Unicoin, accusing the company and its executives of fraudulently raising over $100 million through misleading claims about token security and backing.
