HomeNewsSEC Temporarily Freezes Binance.US Customer Assets for Investor Protection; Binance.com Withdrawals and...

SEC Temporarily Freezes Binance.US Customer Assets for Investor Protection; Binance.com Withdrawals and Assets Remain Unaffected

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    • The SEC is requesting a temporary restraining order to freeze assets related to Binance.US.
    • The move follows a lawsuit against Binance, alleging serious compliance and control failures.

As the clash between the U.S. Securities and Exchange Commission (SEC) and Binance.US escalates, the SEC has taken the bold step of seeking court approval for a temporary restraining order. This would freeze assets associated with BAM Management US Holdings and BAM Trading Services, the entities that hold and operate Binance.US.

Earlier this week, the SEC had brought a lawsuit against Binance.US, Binance Global, and the Binance founder and CEO, Changpeng Zhao, a.k.a. “CZ”. The suit revolved around a series of allegations, chiefly failures in regulatory compliance and internal controls. Particularly contentious was the claim that firms connected to CZ had been surreptitiously accessing funds belonging to Binance.US customers.

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An official SEC filing emphasized the urgency of this action, citing the need to safeguard customer assets and prevent the potential depletion of assets available for judgment. The defendants’ alleged track record of unlawful conduct, evasion of regulatory oversight, and questionable financial transactions were also highlighted as concerns.

In tandem with the request for an asset freeze, the SEC filed another request, seeking various other orders. These include a directive for defendants to repatriate assets held for the benefit of BAM customers, a prohibition against the destruction of records by the defendants, and an order justifying why a preliminary injunction should not be imposed.

Should this restraining order be approved, Binance will be obliged to assure that only Binance.US can access customer funds within a five-day period. Furthermore, all customer assets will need to be transferred to new wallets, accessible solely by Binance.US, within 30 days.

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Responding to these developments, Binance.US took to Twitter to assure its users that their assets remain safe and secure. They claimed their legal representatives have already shared information with the SEC to alleviate concerns over fund safety.

The SEC reiterated many of its original lawsuit arguments in a memorandum of law filed after the temporary restraining order request. They insist that Binance had access to Binance.US funds and suggest that both Binance and CZ had expressed intentions of sidestepping U.S. regulators.

With this unfolding legal drama, the future of Binance.US remains uncertain. While the platform maintains that user assets are secure, the unfolding legal proceedings could drastically affect its operations.

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Brian Johnson
Brian Johnson
A dedicated Bitcoin journalist passionate about uncovering the latest trends, developments, and innovations in the world of cryptocurrency, while delivering engaging and well-researched articles to inform and educate readers on the dynamic digital finance landscape.
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