A federal judge has ordered a temporary stay in legal proceedings between the Securities and Exchange Commission (SEC) and Binance, following a formal request from the two parties. Judge Amy Berman Jackson approved the motion on February 13, which effectively paused their legal dispute for 60 days as per request.

The two parties believe continuing the lawsuit while the SEC’s task force is working might be a waste of resources.

On February 10, the SEC and Binance submitted a joint motion to the U.S. District Court for the District of Columbia, seeking approval to put their ongoing legal battle on hold for 60 days. The parties cited the establishment of the SEC’s Crypto Task Force as their reason for the request.

Backing The SEC Away

The task force, led by SEC Commissioner Hester Peirce and Acting Chairman Mark Uyeda, is working to develop an encompassing regulatory framework for cryptocurrencies. The SEC is also collaborating with industry participants and other regulatory bodies, like the Commodity Futures Trading Commission (CFTC) as part of the initiative.

In their joint motion, both the SEC and Binance stated that the task force’s work could impact their legal dispute, potentially leading to a resolution. The pause would be beneficial for judicial efficiency and resource conservation.

Thursday’s court order mandates that Binance and the SEC submit a joint status report by April 14, 2025, detailing the progress of any discussions or potential resolutions they may be pursuing during the granted stay.

In other words, the pause suggests that the SEC and Binance may explore settlement options or alternative dispute resolution methods in the next two months. The 60-day window permits both sides to engage in these discussions without the pressure of ongoing litigation.

Better For Binance

In a statement shared after the joint motion was submitted, Binance said they appreciate Chairman Uyeda’s work on crypto regulation. The firm believes this regulatory focus will help resolve their legal dispute with the SEC.

“We are eager to put this behind us and to continue our focus on keeping Binance the most secure, licensed and trusted exchange in the world,” Binance stated.

In a lawsuit filed in June 2023, the SEC accused Binance of several violations, including artificially inflating trading volumes and misappropriating customer funds. The SEC also alleges that Binance failed to properly restrict access to its platform for U.S. customers and facilitated the trading of tokens considered by the SEC to be unregistered securities.

At the time, Binance also faced a separate suit from the U.S. Department of Justice (DOJ), where it was accused of failing to implement and maintain an effective anti-money laundering (AML) program.

In November 2023, Binance pleaded guilty to violating U.S. banking laws and agreed to pay approximately $4.3 billion in penalties and forfeitures to settle charges with the DOJ, the CFTC, the Financial Crimes Enforcement Network (FinCEN), and the Office of Foreign Assets Control (OFAC). The multi-party settlement did not involve the SEC’s case.

Following a court hearing in early 2024, Judge Jackson ruled in June that most of the SEC’s claims against Binance could proceed. While the court decision was a setback for Binance, it represented a partial win for the crypto industry.

The judge rejected the SEC’s argument that any secondary sale of BNB or BUSD constitutes a securities transaction, which narrows the scope of the SEC’s lawsuit.

The outcome of the case will depend on the SEC’s new regulatory approach and any potential early resolution facilitated by the Crypto Task Force. Other crypto firms, like Ripple, Coinbase, and Kraken, may also seek similar stays in their cases with the SEC.

After suing Binance, the SEC launched enforcement action against Coinbase. The regulator accused the exchange of running an unregistered digital asset trading platform.

The SEC also targeted Coinbase’s stalking-as-a-service program, claiming it constitutes an unregistered securities offering.