In a recent development, US Judge Amy Berman Jackson gave her approval to an agreement between Binance.US, Binance, and the Securities and Exchange Commission (SEC), thereby dismissing an earlier temporary restraining order (TRO) that aimed to freeze all Binance.US assets. This decision followed Judge Jackson’s indication on June 14 that she preferred the parties involved to independently reach a settlement rather than have her issue a ruling.
The Parties Reach a Mutual Agreement
The opposing sides reportedly came to a consensus on June 16. “We are pleased to inform you that the Court did not grant the SEC’s request for a TRO and freeze of assets on our platform which was clearly unjustified by both the facts and the law,” Binance.US announced on Twitter.
As per the approved agreement, only Binance.US employees will have access to client funds until the conclusion of the litigation. Throughout this period, US-based customers will retain the ability to withdraw their funds.
Terms of the Agreement and Future Implications
The negotiated deal between the crypto exchange and the US regulator also bars Binance global officials from accessing private keys of wallets, hardware wallets, or root access to Binance.US’s Amazon Web Services tools.
Binance.US, responding to allegations of funds mismanagement, stated, “There has never been any evidence presented by the SEC concerning mis-use 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.”
Interestingly, the agreement includes a clause regarding the repatriation of certain assets to the US, as noted by John Reed Stark, former chief of the SEC’s Office of Internet Enforcement, in a Twitter comment on the case. Binance.US is required, according to the agreement, to provide a “verified written accounting” of accounts related to BAM entities valued greater than $1,000.
Brief Backstory of the Binance.US and SEC Dispute
On June 6, the SEC filed an emergency motion for a temporary restraining order on Binance.US, following allegations that Binance CEO Changpeng “CZ” Zhao had access to Binance.US customer funds. Binance.US and Zhao jointly submitted a memorandum before the restraining order hearing, denying any mismanagement of funds and emphasizing that the SEC had failed to identify any instances of Binance.US customer funds being misused.
