The U.S. Securities and Exchange Commission (SEC) has requested a 60-day pause in its ongoing lawsuit against Binance and its founder, Changpeng Zhao, in a move that could signal a shift in regulatory policy on cryptocurrency enforcement. The joint motion, filed with Binance and Zhao, suggests that the agency’s new crypto task force may impact the case’s resolution. The SEC’s legal action against Binance was part of a broader crackdown on the cryptocurrency industry, led by former SEC Chair Gary Gensler.
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The regulator previously accused major players like Coinbase and Ripple of unlawfully trading or issuing unregistered securities. Under Gensler, the agency pushed for stricter oversight, arguing that many cryptocurrencies should be regulated similarly to traditional financial assets. With Hester Peirce now leading the SEC’s crypto task force, the regulatory stance appears to be evolving. Peirce, a longtime critic of Gensler’s “regulation by enforcement” approach, has consistently advocated for clearer guidelines instead of punitive actions.
This shift, along with the agency’s request to halt the lawsuit, indicates that the SEC could be reconsidering its litigation-heavy approach against the crypto industry. The timing of this decision follows significant political and regulatory changes in the U.S. After taking office in January, President Donald Trump appointed Paul Atkins, a pro-crypto lawyer, as the new SEC Chair. Trump has previously criticized the SEC’s aggressive stance on cryptocurrency, arguing that it undermines U.S. leadership in the digital asset space.
This policy shift is further reflected in new legislative efforts aimed at defining the role of digital assets within the financial system. The SEC’s pause request is particularly notable given Binance’s legal history. In November 2023, the exchange pleaded guilty to violating U.S. banking laws, including failing to prevent criminal and terrorist activities on its platform. As part of the settlement, Binance paid $4.3 billion in penalties, and Zhao served a four-month prison sentence.
While the SEC has not confirmed whether the lawsuit will ultimately be dropped, the development suggests a potential softening of regulatory pressure on the crypto industry. Industry insiders anticipate that this move could lead to a broader reassessment of enforcement actions taken under Gensler’s leadership. A Binance spokesperson expressed optimism about the regulatory shift, stating, “We are grateful to Interim Chairman Uyeda for his thoughtful approach to ensuring digital assets receive the appropriate legislative and regulatory focus in this new, golden era of blockchain in the U.S. and around the world.” – By CryptoWire News Desk.