Binance, Binance.US and the US Securities and Exchange Commission (SEC) announced an agreement late Friday to ensure that only Binance.US employees can access client funds in the short term. Here are the details…
Binance and SEC make deal
Under the proposed agreement, which must be signed by the federal judge overseeing the case, BinanceUS will take steps to ensure that no Binance Holdings (referring to the global exchange) official can access private keys for various wallets, hardware wallets or Binance.US root access to Amazon Web Services tools. In addition, the US-based crypto trading platform will share detailed information on operating expenses, including estimated costs, in the coming weeks.
The proposed deal comes in response to the SEC’s request to freeze all assets of Binance.US as it pursues the exchange over securities-related charges. The regulator said it was concerned that funds could be moved overseas or records destroyed if a temporary restraining order (TRO) is not issued. Binance.US’s lawyers backed off, saying that freezing all of their assets would amount to a “death sentence.”
What had happened?
District Court Judge Amy Berman Jackson for the District of Columbia said it would be better for the parties to agree on a proposed specification rather than prepare a restraining order. She stated that she tro came with a two-week limit for a more in-depth trial. He said during a hearing earlier this week that two weeks would be insufficient time to prepare, given the more than 4,000 pages of evidence the parties have already submitted.
Other provisions in the proposed deal will enable Binance.US to create new crypto wallets beyond the reach of global exchange employees, provide additional information to the SEC, and agree to an accelerated discovery program. US-based customers will be allowed to withdraw during this time. The proposed deal, if adopted, would address some of the concerns the SEC has raised as its broader litigation moves through the judicial system. As we reported on Kriptokoin.com, the SEC sued Binance and Binance.US last week on charges of offering and trading unregistered securities. But he also claimed that the funds were heavily mixed and bad practices. The proposed settlement does not cover a wider litigation.
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