The U.S. Securities and Exchange Commission (SEC) has officially dropped its high-profile lawsuit against Binance, signaling a major policy reversal in the regulation of cryptocurrency. A joint motion filed on May 29 by the SEC, Binance, and co-founder Changpeng Zhao asked a federal court to dismiss the case with prejudice, ensuring it cannot be reopened.

The lawsuit, filed in June 2023, accused Binance, Zhao, and its U.S. arm BAM Trading of violating securities laws, mismanaging customer assets, and misleading investors. However, with the SEC’s Crypto Task Force reevaluating its strategy, the agency has decided that continuing the case no longer aligns with its current policy direction.

This decision follows previous delays in February and April, which hinted at a possible withdrawal. Binance celebrated the news on X, calling it a “huge win for crypto” and thanked President Trump and newly appointed SEC Chair Paul Atkins for shifting the agency’s approach.

The SEC’s move comes after Binance and Zhao reached a separate $4.3 billion settlement with the Department of Justice in November 2023. Zhao stepped down as CEO and later received a four-month prison sentence in April 2024 for money laundering violations.

This is just the latest in a string of regulatory retreats. Under the Trump administration, the SEC has either dropped or settled enforcement actions against several major crypto firms, including Coinbase, Kraken, and ConsenSys. Investigations into Circle, Immutable, and OpenSea have also been quietly shelved.

Atkins, a former crypto lobbyist, now leads the SEC and has promised a new regulatory framework for digital assets. The agency is planning industry roundtables to craft future policy, marking a clear pivot from enforcement to collaboration.