On June 17, United States Judge Amy Berman Jackson approved an agreement between Binance.US, Binance and the Securities and Exchange Commission (SEC) that dismisses a previous temporary restraining order (TRO) that would have frozen all assets of Binance.US.
Judge Jackson said on June 14 she he would prefer the parties to come to an agreement themselves rather than be ruled by her. Parties allegedly reached an agreement on June 16.
“We are pleased to announce that the court has denied the SEC’s request for a TRO and asset freeze on our platform, which was clearly unfounded both in fact and in law,” Binance.US said on Twitter.
According to the approved agreement, only Binance.US employees will have access to client funds until the lawsuit is resolved. US-based customers will retain the ability to withdraw funds during this period.
We want to provide updates on the current battle https://t.co/AZwoBOh0gq finds himself in the SEC. We are pleased to inform you that the Court has denied the SEC’s request for a TRO and asset freeze on our platform, which was clearly unwarranted by both the facts and…
— Binance.US (@BinanceUS) June 17, 2023
The agreement between the crypto exchange and the US regulator also prevents Binance global officials from having any access to wallet private keys, hardware wallets or root access to Binance.US’s Amazon Web Services tools.
“The SEC has never presented any evidence of misappropriation of customer assets. In fact, SEC lawyers admitted in court earlier this week when asked by a judge that they have no evidence to suggest that such a thing took place.” ” wrote Binance.US regarding allegations of mismanagement of funds.
Commenting on the case on Twitter, the former head of the SEC’s Office of Internet Law Enforcement, John Reed Stark he remarked that the agreement contains a “particularly interesting provision” on the repatriation of certain assets to the US
“Defendants will repatriate to the United States, transfer to BAM Trading, and certify that BAM Trading holds, escrows, and controls all fiat currencies and crypto-assets that are deposited, held, traded, or accumulated by customers in the United States. […],” reads the contract.
In addition, the agreement claims that Binance.US must immediately take measures to ensure “verified written accounting” of accounts related to BAM entities worth more than $1,000.
SEC filed an extraordinary motion to issue a temporary restraining order on Binance.US on June 6 after accusing Binance CEO Changpeng “CZ” Zhao of accessing Binance.US customer funds in a lawsuit. The regulator alleged that Zhao moved $12 billion of Binance funds through an entity he controlled called Merit Peak.
Before the hearing on the restraining order, Binance.US and Zhao submitted a joint memorandum denying that the funds were ever mishandled. According to them, the SEC was unable to identify a single instance where Binance.US customer funds were misused.
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