Amid the unfolding developments between the US Securities and Exchange Commission (SEC) and leading crypto exchange Binance, a pivotal update involving Circle, the issuer behind stablecoin USD Coin (USDC), has emerged just ahead of a hearing scheduled for October 12.
The influential third-party entity has now been granted permission to weigh in on the lawsuit, potentially adding a nuanced perspective to the case.
Circle’s Role As Amicus Curiae Explained
District Judge Amy Berman Jackson of the US District Court for the District of Columbia recently took several key steps in preparation for the upcoming hearing. One such step involved sorting through and deciding upon pending motions related to the lawsuit initiated by the SEC against Binance.
Among the motions cleared by Judge Jackson, an amicus brief filed by Circle stands out. Circle had submitted this motion to the court on September 29 amid the ongoing legal face-off between the SEC and Binance.
In their argument, Circle vehemently contended that assets pegged to the US dollar, including USDC, should not be classified as securities.
According to their stance, buyers do not anticipate profits when purchasing these stablecoins, as their primary purpose is to act as a medium of exchange. Circle further elaborated that stablecoins, in essence, lack the attributes that would categorize them as “investment contracts.”
After considering Circle’s motion, Judge Jackson accepted the firm’s role as amicus curiae, clarifying that their position would neither favor Binance nor its CEO, Changpeng Zhao, in their respective efforts to dismiss the lawsuit.
However, the court also emphasized that Circle, as amicus curiae, would be allowed to partake in oral arguments only upon receiving explicit permission from the court.
For clarity, an amicus curiae, or “friend of the court,” is an individual or entity not a party to a lawsuit but possesses expertise or a vested interest in the lawsuit’s outcome. They provide information, expertise, or insight that has a bearing on the issues in the case, aiding the court in its decision-making process.
Recent Updates On SEC Vs. Binance Lawsuit
Crypto research firm Paradigm recently filed an amicus brief in the ongoing lawsuit between the SEC, Binance, its US affiliate – Binance.US, and the exchange’s global CEO, Changpeng Zhao.
According to the released statement, Paradigm, which asserts it has no vested interest or investment in the defendants, took a stance against the SEC. The firm particularly accused the commission of governmental overreach.
Paradigm further argues that the SEC is trying to bypass the rule-making process to rewrite the law, leveraging the “disturbing allegations” in its lawsuit against Binance and its co-defendants.
Before this development, Binance had already taken action against the SEC, filing a joint motion to dismiss the US SEC’s lawsuit against them, including Bam Management Holdings Inc.
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