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Binance strikes deal with SEC, US assets to stay

June 17, 2023
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Binance, the world's largest cryptocurrency exchange, and Binance.US have agreed with the U.S. Securities and Exchange Commission (SEC) to ensure U.S. customer assets remain in the country during an ongoing lawsuit. The agreement means only Binance.US employees will have access to these assets, amidst allegations of misconduct by Binance.

Agreement Details: Binance and Binance.US have formed a pact with the SEC to keep U.S. customer assets within the country during the lawsuit.
  • The agreement is pending the approval of the federal judge managing the case.
  • As per the agreement, only Binance.US employees will be able to access the U.S. customer assets.

  • Lawsuit Allegations: The SEC's lawsuit against Binance, its CEO Changpeng Zhao, and Binance.US's operator includes several allegations.
  • Accusations involve artificially inflated trading volumes and diversion of customer funds.
  • The SEC also alleges Binance did not restrict U.S. customers from its platform and misled investors about its market surveillance controls.

  • Agreement Conditions: The agreement includes several conditions to protect U.S. customer assets.
  • Binance.US will ensure that no Binance Holdings officials have access to private keys for its various wallets or root access to its Amazon Web Services tools.
  • The agreement is designed to protect investor assets and ensure they can continue to withdraw these assets.

  • Binance's Response: Binance maintains that the SEC's request for emergency relief was unwarranted.
  • However, Binance expressed satisfaction that a resolution was reached on mutually acceptable terms.
  • Binance reassures that user funds will always be safe and secure on all Binance-affiliated platforms.

  • Additional Provisions: The agreement includes other provisions to safeguard U.S. customer assets.
  • Binance.US will create new crypto wallets to which the global exchange's employees have no access.
  • It will provide additional information to the SEC and adhere to an expedited discovery schedule.

  • Impact on Binance.US Operations: The U.S. affiliate of Binance paused dollar deposits recently due to the lawsuit.
  • It gave customers a deadline of June 13 to withdraw their dollar funds after the SEC requested a court to freeze its assets.
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