Under a proposed settlement decree, Binance.US would be required to move all US-based assets to new wallets while still being permitted to pay its debts.
One of the biggest cryptocurrency exchanges in the world, Binance, as well as its CEO Changpeng Zhao (CZ), have become the target of legal action by the United States Securities and Exchange Commission (SEC). The SEC filed a lawsuit, alleging that Binance broke laws governing investor protection by conducting unregistered securities offerings.
BAM Trading, which runs Binance’s U.S. division, was also the target of an urgent request to freeze its assets in response to the SEC’s action. BAM Trading, on the other hand, submitted a counterargument that disputed the SEC’s justification for the asset freezing.
The SEC and BAM Trading jointly submitted a request for a consent order to address the issue, which would loosen some of the limits put in place by the asset freeze. The proposed consent order would permit BAM Trading to meet its financial obligations, including as paying its staff, while also giving the SEC further assurances.
Binance is forbidden from making any payments or transferring any assets to any Binance corporation or person working on its behalf, which is one of the primary restrictions in the proposed consent order. Furthermore, it specifically prohibits Changpeng Zhao, CEO of Binance, from accessing BAM Trading or Binance.US assets.
The proposed consent order has not yet been accepted by the court as of the publication date of this story. The SEC and Binance continue to argue on the specifics, and the court has asked for more explanation in order to resolve the issue.
The resolution of this legal dispute between Binance and the SEC will have a big impact on Binance’s activities in the US as well as the regulatory environment governing the cryptocurrency market.