Binance license revocation in Florida overturned by court

Binance.US, a subsidiary of the world’s largest crypto exchange Binance, has won an appeal against the Florida regulator’s Emergency Suspension Order (ESO), according to a ruling by the Florida First District Court of Appeals on Wednesday.

Court rules in favor of Binance.US

The First District Court of Appeals for the State of Florida ruled on May 22 that Changpeng Zhao’s pleas to Binance Holdings for non-compliance with the Anti-Money Laundering (AML) and Bank Secrecy Act are insufficient to prevent Binance.US from operating in the state.

The court said the Florida Office of Financial Regulation (OFR) never supported a legal conclusion that Zhao’s conduct constituted grounds for suspending the license of the company’s Florida subsidiary, Binance.US, because Zhao’s conduct allegedly constituted “a posed an immediate threat to public health.” , safety and welfare require an emergency release.”

On November 29, 2023, OFR issued an Emergency Suspension Order (ESO) to suspend the money services business license of Binance.US and directed the exchange to stop conducting money transfer activities.

“The ESO contains a material procedural error and misinterpretation of sections 560.114(2) and 120.60(6) of the Florida Statutes,” the court’s analysis of the order states. The ESO has also failed to discuss alternative remedies instead of license suspension due to the risk of significant financial loss.

Also read: Binance delists major cryptocurrencies, brace for price impact

Binance is facing challenges in the USA

Binance’s subsidiary Binance.US saw a sharp decline in trading volume due to a number of challenges, including the suspension of its money transmitter license and increased scrutiny from regulators.

The lawsuit between Binance and SEC is in the disclosure and filing phase, with the parties resolving disputes related to a previous consent order from the court.

Recently, a significant development has emerged in Binance’s favor as it uses key details in the USA v. Eisenberg lawsuit to refute the US Securities and Exchange Commission’s position on stablecoins that BUSD and USDC are unregistered securities. An exhibit in the US Department of Justice filing states that the USDC stablecoin is not a security because it does not pass the Howey test.

“But there is no factual basis for treating USDC as a security or putting this question to the jury. A core component of a security is that the holders of the security “expect to profit” from the efforts of others,” the DOJ filing said.

Also read: Sell-off in the crypto market – This is why BTC, ETH, SOL, XRP and meme coins suddenly fall