SEC Requests Emergency Order to Freeze Binance US Assets

Share IT

Key takeaways:

  • Binance has been charged by the SEC with mismanaging funds and running an unlicensed securities exchange.
  • The motion asks for the preservation of records and the repatriation of assets.

On June 6, the United States Securities and Exchange Commission (SEC) submitted an emergency application to the District of Columbia U.S. District Court asking for a temporary restraining order against Binance, Binance.US, and CEO Changpeng Zhao (C.Z.). 

The freezing of Binance.US’s assets and the repatriation of cash and cryptocurrency held by or for the benefit of U.S. clients are among the proposed actions. The motion also places additional restrictions on discovery and forbids the defendants from erasing, changing, or hiding records. As stated in the filing:

“This relief is necessary on an expedited basis to ensure the safety of customer assets and prevent the dissipation of available assets for any judgment, given the Defendants’ years of violative conduct, disregard of the laws of the United States, evasion of regulatory oversight, and open questions about various financial transfers and the custody and control of Customer Assets.”

The defendants are required to transfer all customer crypto assets to new wallets with new private keys that will be in the custody of BAM Trading officers and employees based in the United States. It is requested that assets belonging to U.S. consumers be transferred back to Binance.US within ten days. Assets held by customers would still be redeemable, but transfers of more than $100,000 will need to be handled carefully.

According to the order, the defendants would also have to give the SEC a list of their clients’ fiat and cryptocurrency assets as well as a list of Binance.US customers and a breakdown of their account balances.

This action comes after the SEC sued Binance, the biggest cryptocurrency exchange in the world, for violating securities laws the day before. Many of the claims made against Binance had been debunked as “conspiracy theories” by the exchange after they had been reported in the media days earlier.

The SEC’s action, according to Binance, is “misguided” and “unreasonable,” and the agency’s regulatory approach is damaging America’s status as a major center of the global financial system.

Due to the ongoing litigation brought by the US SEC against it, Binance may encounter business difficulties in South Korea. According to reports, in response to the SEC’s accusations, the Financial Service Committee of South Korea is investigating Binance’s purchase of the regional cryptocurrency trading platform Gopax.

Share IT

Get Daily Updates

Crypto News, NFTs and Market Updates

Claim Your Free Trading Guide

Sign up for newsletter below and get your free crypto trading guide.

Can’t find what you’re looking for? Type below and hit enter!