In the latest turn of events, Binance.US has struck an agreement with the United States Securities and Exchange Commission (SEC), allowing the crypto company to continue its operations even as it battles the fraud charges levied against it by the commission.
Originally, the SEC had filed for a court order on June 6, requesting a temporary restraining order on Binance.US operations along with a freeze of all assets on the trading platform.
However, presiding Judge Amy Jackson refused to grant the order, instead enjoining both parties to come to an agreement that would protect consumer assets without needing to close down the exchange.
According to a press release by the SEC yesterday, both parties had finally reached an understanding, gaining court approval for implementation. However, the initial lawsuit remains in court.
On June 5, the SEC levied 13 charges against Binance.US, its global partner Binance, and their founder, Changpeng Zhao, accusing all parties of running “a web of deception.”
These charges included “operating unregistered exchanges, broker-dealers, and clearing agencies, misrepresenting trading controls and oversight on the Binance.US platform, and the unregistered offer and sale of securities.”
Binance To Repatriate US Customer Funds, Among Others
According to SEC’s statement on its agreement with Binance.US and its co-defendants, all parties have agreed to “repatriate to the United States assets held for the benefits of customers of the Binance.US crypto platform.”
Furthermore. Binance.US is mandated to maintain all its customer assets in the U.S. pending a definitive order on the ongoing court case. The U.S.-based exchange is restricted from all types of spending except those for “ordinary course business expenses,” for which even the SEC must be provided with an oversight.
Finally, Binance.US is strictly prohibited from providing co-defendants, Binance, or Changpeng Zhao any form of access to its customer funds.
Commenting on this agreement, SEC’s Director of Division of Enforcement, Gurbir S. Grewal, stated the need for these agreements reiterating the commission’s commitment to protecting U.S. customer access to their investments.
“Given that Changpeng Zhao and Binance have control of the platforms’ customers’ assets and have been able to commingle customer assets or divert customer assets as they please, as we have alleged, these prohibitions are essential to protecting investor assets,” he said.
“Further, we ensured that U.S. customers will be able to withdraw their assets from the platform while we work to resolve the alleged underlying misconduct and hold Zhao and the Binance entities accountable for their alleged securities law violations.”
Binance.US Remains Resilient, Says SEC Has No Evidence Of Funds Misuse
While acknowledging its recent agreement with SEC, Binance.US has expressed its willingness to continuously defend itself, stating the SEC so far had no evidence to support its allegations.
“There has never been any evidence presented by the SEC concerning misuse of customer assets. In fact, the SEC lawyers conceded in court earlier this week, when asked by the Judge, that they had no evidence suggesting that any such thing had occurred,” Binance.US tweeted yesterday afternoon.
The U.S. exchange also stated that its resolve remained intact while accusing the SEC of a “regulation by enforcement” tactic that had no place in the U.S. justice system.