MOTION for Leave to File Amicus Curiae Brief by PARADIGM OPERATIONS LP. (Attachments: # (1) Exhibit A - Proposed Amicus Brief, # (2) Exhibit B - Certificate of Disclosure - Corporate Affiliations/Financial Interests, # (3) Text of Proposed Order)(Kim, Andrew)
Page 1 IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,
v.
BINANCE HOLDINGS LIMITED, BAM
TRADING SERVICES INC., BAM
MANAGEMENT US HOLDINGS INC., and
CHANGPENG ZHAO,
No. 1:23-cv-01599-ABJ-ZMF
Defendants.
MOTION OF PARADIGM OPERATIONS LP FOR LEAVE TO FILE BRIEF AS
AMICUS CURIAE IN SUPPORT OF DEFENDANTS’ MOTIONS TO DISMISS
Rodrigo Seira
(admission pro hac vice pending)
PARADIGM OPERATIONS LP
548 Market Street
San Francisco, CA (415) 986-rodrigo@paradigm.xyz
Dated: September 28,
Andrew Kim (D.C. Bar No. 1029348)
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, D.C. (202) 346-AndrewKim@goodwinlaw.com
Counsel for Proposed Amicus Curiae
Paradigm Operations LPPage 2 Pursuant to LCvR 7(o)(1), Paradigm Operations LP (“Paradigm”) respectfully requests
leave to file an amicus brief in support of the motion to dismiss filed by Defendants BAM
Management US Holdings Inc. and BAM Trading Services Inc. (ECF No. 117), and the motion
to dismiss filed by Defendants Binance Holdings Limited and Changpeng Zhao (ECF No. 118)
(collectively, “Motions”). Defendants consent to this request. Plaintiff Securities and Exchange
Commission (“SEC”) takes no position on Paradigm’s request for leave at this time, but it states
that it reserves the right to object to Paradigm’s brief upon review of the filing.
A copy of Paradigm’s proposed amicus brief is attached to this motion as Exhibit A.
INTEREST OF THE AMICUS CURIAE Paradigm Operations LP (“Paradigm”) is a research-driven investment firm that focuses
on crypto and related technologies at the frontier. Paradigm takes a hands-on approach to help
projects reach their full potential, from the technical (mechanism design, security, engineering)
to the operational (recruiting, go-to-market, legal and regulatory strategy).
Crypto and the blockchain technology that powers it have the potential to create a new
computational framework that can democratize the internet and revamp many sectors of the
economy, including the global financial system. Blockchain-based protocols can be
decentralized by distributing their operations across a network of computers and using crypto
assets (tokens) as a mechanism to enable coordination. These systems are, in effect, community
owned and operated.
No counsel for any party authored the attached brief in whole or in part, and no entity or
person, aside from the proposed amicus curiae and its counsel, made any monetary contribution
intended to fund the preparation or submission of the attached brief. As of the time of this
motion’s filing, the undersigned counsel and his law firm do not represent any of the parties
before this Court with respect to this case or any related matters, although other attorneys in the
same law firm currently represent BAM Trading Services Inc. with respect to unrelated matters.
1Page 3 Despite the great promise of crypto, the SEC has pursued an incoherent approach to
regulating crypto assets that is premised on its mistaken assertion that a crypto asset falls within
the reach of the Securities Act of 1933, 15 U.S.C. §§ 77a et seq., and the Securities Exchange
Act of 1934, 15 U.S.C. §§ 78a et seq. (collectively, “Securities Laws”), so long as that asset
might potentially yield a profit to its purchaser. That extraordinary and overreaching
construction of the Securities Laws threatens the development of crypto technology in the United
States and could destabilize other significant markets that are widely understood to be outside the
SEC’s jurisdiction.
Paradigm did not invest in Defendants, and has no financial or other interest tied to
Defendants. And Paradigm takes no view on any of the SEC’s allegations against Defendants,
other than those concerning ordinary transactions for the purchase and sale of tokens on
Defendants’ exchange platforms.
But Paradigm has a strong interest in ensuring that the Securities Laws are interpreted
correctly and in a way that is not colored by the tint of misconduct, like the allegations leveled
by the SEC in this case. Here, and in other cases, the SEC has acted in excess of its statutory
authority. The agency’s arrogation of authority cannot stand, regardless of whatever the SEC
may say about a particular defendant—unsavory allegations should not define the scope of an
agency’s powers. Paradigm seeks to participate as an amicus here, as it has done in other cases, to ensure that the SEC’s regulatory overreach does not serve as an impediment to innovation, and
SEC v. Coinbase, Inc., No. 23-cv-04738 (S.D.N.Y. Aug. 11, 2023) (ECF No. 50); SEC v.
Bittrex Inc., No. 23-cv-580 (W.D. Wa. July 7, 2023) (ECF No. 41); SEC v. Terraform Labs Pte
Ltd., No. 23-cv-1346 (S.D.N.Y. Apr. 21, 2023) (ECF No. 27); SEC v. Wahi, No. 22-cv-(W.D. Wash. Mar. 9, 2023) (ECF No. 67); SEC v. Ripple Labs, No. 20-cv-10832 (S.D.N.Y. Nov.
11, 2022) (ECF No. 701-1).
2Page 4 does not interfere with Congress’s ability to create a framework for sensible, effective regulation
of crypto assets.
ARGUMENT
“[T]his Court has ‘broad discretion’ in determining whether to permit a party to
participate in a lawsuit as amicus curiae.” Commonwealth of the N. Mariana Islands v. United
States, No. 08-1572, 2009 WL 596986, at *1 (D.D.C. Mar. 6, 2009) (citation omitted). “Amicus
participation is normally appropriate when,” among other reasons, “the amicus has unique
information or perspective that can help the court beyond the help that the lawyers for the parties
are able to provide.” Hard Drive Prods., Inc. v. Does 1-1, 495, 892 F. Supp. 2d 334, (D.D.C. 2012) (citation omitted).
Paradigm respectfully submits that it should be granted leave to file the attached amicus
brief because the brief will assist the Court in its disposition of Defendants’ Motions, and
provide insights not presented by the parties. In particular, Paradigm’s proposed brief explains
just how far the SEC’s authority would reach—to cover sales of precious metals, fine art, and
other items that plainly are not securities—under the SEC’s views on what constitutes an
“investment contract” under federal securities law. In addition, Paradigm’s brief illustrates how
the SEC’s square-peg-round-hole approach to regulating crypto assets is not just implausible as a
legal matter, but as a practical one as well. The brief sheds light on how crypto asset issuers and
exchanges that have tried to follow the SEC’s rules have only ended up in failure, largely
because the SEC has not articulated any actionable standards by which crypto issuers and
exchanges should abide.
As Paradigm’s proposed brief “present[s] ideas, arguments, theories, insights, facts, or
data that are not to be found in the parties briefs,” and will assist this Court in its consideration of
3Page 5 Defendants’ Motions, Paradigm submits that “[t]he filing of [Paradigm’s] amicus brief should be
permitted.” Mashpee Wampanoag Tribe v. Bernhardt, No. 18-2242, 2020 WL 2615523, at *(D.D.C. May 22, 2020) (citation and internal quotation marks omitted).
CONCLUSION
For these reasons, this Court should grant Paradigm’s motion for leave to file the amicus
brief attached hereto as Exhibit A.
Dated: September 28,
Respectfully submitted,
/s/ Andrew Kim
Andrew Kim (D.C. Bar No. 1029348)
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, D.C. (202) 346-andrewkim@goodwinlaw.com
Rodrigo Seira
(admission pro hac vice pending)
PARADIGM OPERATIONS LP
548 Market Street
San Francisco, CA (415) 986-rodrigo@paradigm.xyz
Counsel for Proposed Amicus Curiae
Paradigm Operations LP
4
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Case 1:23-cv-01599-ABJ-ZMF Document 128 Filed 09/28/23 Page 1 of 5
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
SECURITIES AND EXCHANGE
COMMISSION,
Plaintiff,
v.
BINANCE HOLDINGS LIMITED, BAM
TRADING SERVICES INC., BAM
MANAGEMENT US HOLDINGS INC., and
CHANGPENG ZHAO,
No. 1:23-cv-01599-ABJ-ZMF
Defendants.
MOTION OF PARADIGM OPERATIONS LP FOR LEAVE TO FILE BRIEF AS
AMICUS CURIAE IN SUPPORT OF DEFENDANTS’ MOTIONS TO DISMISS
Rodrigo Seira
(admission pro hac vice pending)
PARADIGM OPERATIONS LP
548 Market Street
San Francisco, CA 94104
(415) 986-9283
rodrigo@paradigm.xyz
Dated: September 28, 2023
Andrew Kim (D.C. Bar No. 1029348)
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, D.C. 20036
(202) 346-4000
AndrewKim@goodwinlaw.com
Counsel for Proposed Amicus Curiae
Paradigm Operations LP
PDF Page 3
Case 1:23-cv-01599-ABJ-ZMF Document 128 Filed 09/28/23 Page 2 of 5
Pursuant to LCvR 7(o)(1), Paradigm Operations LP (“Paradigm”) respectfully requests
leave to file an amicus brief in support of the motion to dismiss filed by Defendants BAM
Management US Holdings Inc. and BAM Trading Services Inc. (ECF No. 117), and the motion
to dismiss filed by Defendants Binance Holdings Limited and Changpeng Zhao (ECF No. 118)
(collectively, “Motions”). Defendants consent to this request. Plaintiff Securities and Exchange
Commission (“SEC”) takes no position on Paradigm’s request for leave at this time, but it states
that it reserves the right to object to Paradigm’s brief upon review of the filing.
A copy of Paradigm’s proposed amicus brief is attached to this motion as Exhibit A.
INTEREST OF THE AMICUS CURIAE 1
Paradigm Operations LP (“Paradigm”) is a research-driven investment firm that focuses
on crypto and related technologies at the frontier. Paradigm takes a hands-on approach to help
projects reach their full potential, from the technical (mechanism design, security, engineering)
to the operational (recruiting, go-to-market, legal and regulatory strategy).
Crypto and the blockchain technology that powers it have the potential to create a new
computational framework that can democratize the internet and revamp many sectors of the
economy, including the global financial system. Blockchain-based protocols can be
decentralized by distributing their operations across a network of computers and using crypto
assets (tokens) as a mechanism to enable coordination. These systems are, in effect, community
owned and operated.
1
No counsel for any party authored the attached brief in whole or in part, and no entity or
person, aside from the proposed amicus curiae and its counsel, made any monetary contribution
intended to fund the preparation or submission of the attached brief. As of the time of this
motion’s filing, the undersigned counsel and his law firm do not represent any of the parties
before this Court with respect to this case or any related matters, although other attorneys in the
same law firm currently represent BAM Trading Services Inc. with respect to unrelated matters.
1
PDF Page 4
Case 1:23-cv-01599-ABJ-ZMF Document 128 Filed 09/28/23 Page 3 of 5
Despite the great promise of crypto, the SEC has pursued an incoherent approach to
regulating crypto assets that is premised on its mistaken assertion that a crypto asset falls within
the reach of the Securities Act of 1933, 15 U.S.C. §§ 77a et seq., and the Securities Exchange
Act of 1934, 15 U.S.C. §§ 78a et seq. (collectively, “Securities Laws”), so long as that asset
might potentially yield a profit to its purchaser. That extraordinary and overreaching
construction of the Securities Laws threatens the development of crypto technology in the United
States and could destabilize other significant markets that are widely understood to be outside the
SEC’s jurisdiction.
Paradigm did not invest in Defendants, and has no financial or other interest tied to
Defendants. And Paradigm takes no view on any of the SEC’s allegations against Defendants,
other than those concerning ordinary transactions for the purchase and sale of tokens on
Defendants’ exchange platforms.
But Paradigm has a strong interest in ensuring that the Securities Laws are interpreted
correctly and in a way that is not colored by the tint of misconduct, like the allegations leveled
by the SEC in this case. Here, and in other cases, the SEC has acted in excess of its statutory
authority. The agency’s arrogation of authority cannot stand, regardless of whatever the SEC
may say about a particular defendant—unsavory allegations should not define the scope of an
agency’s powers. Paradigm seeks to participate as an amicus here, as it has done in other cases, 2
to ensure that the SEC’s regulatory overreach does not serve as an impediment to innovation, and
2
SEC v. Coinbase, Inc., No. 23-cv-04738 (S.D.N.Y. Aug. 11, 2023) (ECF No. 50); SEC v.
Bittrex Inc., No. 23-cv-580 (W.D. Wa. July 7, 2023) (ECF No. 41); SEC v. Terraform Labs Pte
Ltd., No. 23-cv-1346 (S.D.N.Y. Apr. 21, 2023) (ECF No. 27); SEC v. Wahi, No. 22-cv-1009
(W.D. Wash. Mar. 9, 2023) (ECF No. 67); SEC v. Ripple Labs, No. 20-cv-10832 (S.D.N.Y. Nov.
11, 2022) (ECF No. 701-1).
2
PDF Page 5
Case 1:23-cv-01599-ABJ-ZMF Document 128 Filed 09/28/23 Page 4 of 5
does not interfere with Congress’s ability to create a framework for sensible, effective regulation
of crypto assets.
ARGUMENT
“[T]his Court has ‘broad discretion’ in determining whether to permit a party to
participate in a lawsuit as amicus curiae.” Commonwealth of the N. Mariana Islands v. United
States, No. 08-1572, 2009 WL 596986, at *1 (D.D.C. Mar. 6, 2009) (citation omitted). “Amicus
participation is normally appropriate when,” among other reasons, “the amicus has unique
information or perspective that can help the court beyond the help that the lawyers for the parties
are able to provide.” Hard Drive Prods., Inc. v. Does 1-1, 495, 892 F. Supp. 2d 334, 337
(D.D.C. 2012) (citation omitted).
Paradigm respectfully submits that it should be granted leave to file the attached amicus
brief because the brief will assist the Court in its disposition of Defendants’ Motions, and
provide insights not presented by the parties. In particular, Paradigm’s proposed brief explains
just how far the SEC’s authority would reach—to cover sales of precious metals, fine art, and
other items that plainly are not securities—under the SEC’s views on what constitutes an
“investment contract” under federal securities law. In addition, Paradigm’s brief illustrates how
the SEC’s square-peg-round-hole approach to regulating crypto assets is not just implausible as a
legal matter, but as a practical one as well. The brief sheds light on how crypto asset issuers and
exchanges that have tried to follow the SEC’s rules have only ended up in failure, largely
because the SEC has not articulated any actionable standards by which crypto issuers and
exchanges should abide.
As Paradigm’s proposed brief “present[s] ideas, arguments, theories, insights, facts, or
data that are not to be found in the parties briefs,” and will assist this Court in its consideration of
3
PDF Page 6
Case 1:23-cv-01599-ABJ-ZMF Document 128 Filed 09/28/23 Page 5 of 5
Defendants’ Motions, Paradigm submits that “[t]he filing of [Paradigm’s] amicus brief should be
permitted.” Mashpee Wampanoag Tribe v. Bernhardt, No. 18-2242, 2020 WL 2615523, at *1
(D.D.C. May 22, 2020) (citation and internal quotation marks omitted).
CONCLUSION
For these reasons, this Court should grant Paradigm’s motion for leave to file the amicus
brief attached hereto as Exhibit A.
Dated: September 28, 2023
Respectfully submitted,
/s/ Andrew Kim
Andrew Kim (D.C. Bar No. 1029348)
GOODWIN PROCTER LLP
1900 N Street, N.W.
Washington, D.C. 20036
(202) 346-4000
andrewkim@goodwinlaw.com
Rodrigo Seira
(admission pro hac vice pending)
PARADIGM OPERATIONS LP
548 Market Street
San Francisco, CA 94104
(415) 986-9283
rodrigo@paradigm.xyz
Counsel for Proposed Amicus Curiae
Paradigm Operations LP
4
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