Key Takeaways:
- A federal judge has granted Binance.US approval to invest certain customer assets in U.S. Treasury bills
- Binance.US must transfer cryptocurrency assets to a third-party custodian not affiliated with the exchange.
Binance.US, the American affiliate of the global crypto exchange Binance, has secured a pivotal court victory. A federal judge has granted Binance.US permission to invest certain customer assets in the U.S.
Treasury bills, lifting previous restrictions imposed by the U.S. Securities and Exchange Commission (SEC).
The ruling, issued by Judge Amy Berman Jackson of the U.S. District Court for the District of Columbia, allows Binance.US to collaborate with third-party investment advisers to manage the assets of BAM Trading Services Inc. and BAM Management US Holdings Inc., collectively known as BAM.
According to the court order, BAM is authorized to invest customer fiat funds, currently custodied at BitGo, in U.S. Treasury bills that will mature on a rolling four-week basis.
Several conditions accompany this ruling to ensure compliance and transparency:
- Third-Party Custodian: Binance.US must transfer crypto assets to a third-party custodian not affiliated with the exchange.
- Exclusive Management: The private and administrative keys for the wallets holding these assets must be maintained solely by U.S.-based employees of Binance.US or the third-party custodian.
- Diligence and Oversight: Binance.US must conduct due diligence to ensure the investment advisers managing the assets are not affiliated with any Binance entities.
- Monthly Reports: Detailed monthly reports must be provided, outlining any costs associated with maintaining these Treasury investments.
The court’s approval enables Binance.US to invest approximately $40 million, with $10 million invested in increments over four weeks through a TreasuryDirect trading account. The ruling specifies that no third parties, including Binance entities, can be involved in these investments.
The court document reads: “Notwithstanding any applicable provision of the Consent Order, [Binance.US] BAM is authorized to invest certain customer fiat funds currently custodied at BitGo in United States Treasury bills that will mature on a rolling four-week basis provided that no third parties, including Binance Entities, are involved in the investment.”
Following the announcement of this court victory, the price of Binance Coin (BNB) saw a notable increase. The coin marked an approximate increase of 4.72%.
