The cryptocurrency exchange Binance faced a setback as a federal judge upheld most of the SEC’s charges against the company and its founder in a closely watched legal battle. The ruling, which came as part of a lawsuit separate from the ongoing Department of Justice case involving Binance founder Changpeng Zhao, saw the court dismissing a charge related to secondary sales of BNB.

The court’s decision provided a mixed outcome for Binance, with its BUSD and Simple Earn programs receiving approval as they were deemed not to constitute investment contracts. However, the judge’s ruling largely favored the SEC’s arguments, finding merit in the agency’s claims that Binance may have offered unregistered investment products and violated anti-fraud provisions.

Despite attempts by Binance to challenge the SEC’s charges, the judge rejected many of the company’s arguments, including the assertion that the SEC lacked authority to regulate the crypto industry. The ruling also raised concerns for Binance’s founder, Changpeng Zhao, suggesting that he could be held personally liable for the company’s violations due to his control over the organization.

While the court dismissed certain claims, such as those related to Binance’s initial sales of BUSD, it allowed the charge against Binance’s Earn Vault to proceed. Out of the 13 charges brought against Binance, only one count concerning BUSD sales was fully dismissed by the court.

Legal experts analyzing the ruling believe that it could have significant implications for Binance’s legal battle with the SEC. The decision underscores the regulatory challenges facing cryptocurrency exchanges and the importance of compliance with securities laws.

For the latest updates on this developing story and other key events in the digital asset ecosystem, stay tuned for more news and analysis.