The SEC's case against Binance held a court hearing, and the judge raised detailed questions

Binance faced the U.S. Securities and Exchange Commission (SEC) in court on Monday in an attempt to have a lawsuit filed by the regulator dismissed. Both sides faced questions from judges about why certain cryptocurrencies should be considered securities and subject to SEC rules. During the hearing, Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia in Washington, D.C., asked both parties whether BNB, BUSD, and other assets traded by Binance did or did not meet the standards of the Howey test. The Howey test is a set of parameters used by the SEC to determine whether an asset is a security. Judge Jackson criticized Binance lawyers’ characterization of the Howey test during Monday’s hearing. Jackson said: "Howey provides that an investment contract is, quote, a contract, transaction or plan. One of three. It does not say it is a contractual transaction or plan." Lawyers representing Binance maintain that for an asset to be a security, it must involve actual contract. The judge later countered that case law showed the statute was intended to be broadly applicable. Later in the hearing, Jackson asked SEC attorneys about criticism that the agency has failed to clearly inform the crypto industry how its rules apply. An attorney for the SEC said he disagreed that the agency had issued contradictory statements, citing guidance the agency had issued over the years. "Howey is clear that you do not need regulators to specifically contact you to alert you of a possible violation of securities laws," the SEC lawyer said. In the SEC’s view, Binance continued to promote its business and the BNB and BUSD tokens it issued, creating reasonable expectations of profit for those who purchased these tokens. Instead, Binance’s lawyers argued that the fact of the promotion itself cannot be a factor because any business would promote itself. (The Block)