Florida’s First District Court of Appeal overturned Binance.US’s license suspension, allowing it to operate despite past AML compliance issues.
The subsidiary of Binance, the largest cryptocurrency exchange in the world.As per the decision made by the Florida First District Court of Appeal on Wednesday, the US has prevailed in its appeal against the Emergency Suspension Order (ESO) issued by the state regulator in Florida.
On May 22, the First District Court of Appeal for the State of Florida decided that plea agreements between Changpeng Zhao and Binance Holdings over noncompliance with the Bank Secrecy Act and Anti-Money Laundering (AML) laws are insufficient to prevent Binance.US from conducting business in the state.
The Florida Office of Financial Regulation (OFR), according to the court, never supported a legal conclusion that Zhao’s actions justified the company’s Florida affiliate Binance.US’s license suspension because Zhao’s actions allegedly “constituted an immediate danger to the public health, safety, and welfare necessitating an emergency suspension.”
The OFR issued an emergency suspension order (ESO) on November 29, 2023, suspending Binance.US’s money-services business license and ordering the exchange to stop transmitting money.
According to the court’s examination of the order, “the ESO contains a material error in procedure and an erroneous interpretation of sections 560.114(2) and 120.60(6), Florida Statutes.” Due to the potential for severe financial losses, the ESO has also neglected to address other options to license suspension.
The US subsidiary of Binance experienced a sharp decline in trading volumes, among other difficulties, such as the suspension of money transmitter licenses and increased regulatory monitoring.
In the discovery and deposition stages of the Binance v. SEC action, the parties are settling disagreements about a previous consent order that the court issued.
A major development has occurred recently in favor of Binance, as it uses important information from the United States v. Eisenberg lawsuit to refute the U.S. SEC’s stablecoin argument that BUSD and USDC are unregistered securities. The USDC stablecoin exhibit in the US DOJ filing claims that because it fails the Howey test, it is not a security.
However, characterization of USDC as a security and placing that matter before the jury have no factual support. According to a DOJ filing, a fundamental feature of a security is that its holders “expect profits” from the efforts of others.
