SEC and Binance.US Strike a Temporary Agreement on Asset Access – Binance, Binance.US, and the United States Securities and Exchange Commission (SEC) reportedly reached an agreement to temporarily restrict customer fund access solely to Binance.US employees on Friday, June 16.
Based on reports, the agreement, subject to approval from the overseeing federal judge, details the steps Binance.US must take to prevent Binance officials from accessing private keys of wallets, hardware wallets, or obtaining root access to Binance.US’s Amazon Web Services tools. Moreover, the U.S.-based cryptocurrency trading platform will disclose detailed information regarding business expenses, including estimated costs, in the coming weeks.
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In response to a motion filed by the SEC, an agreement has been reached to address concerns regarding the freezing of Binance.US’s assets during the ongoing legal proceedings. The SEC had expressed worries that without a temporary restraining order, there could be a possibility of funds being moved offshore or important records being intentionally destroyed.
Nevertheless, the legal representatives of Binance.US strongly objected to this idea, arguing that a complete freeze on all assets would essentially amount to an excessively severe “death penalty” for the company. In a recent hearing, U.S. district court judge Amy Berman Jackson recommended that the parties involved come to an agreement on a proposed stipulation instead of relying on the court to issue a restraining order.
Judge Jackson highlighted the time limitations of a temporary restraining order, which lasts only two weeks, and expressed concerns that it might not be sufficient for a thorough hearing. This is especially relevant given the extensive number of exhibits submitted, totaling over 4,000 pages.
The proposed agreement encompasses several additional provisions, including the establishment of new crypto wallets exclusively for Binance.US, which will not be accessible to employees of other Binance entities. Additionally, Binance.US undertakes to provide the SEC with further information and agrees to an expedited discovery schedule. Importantly, customers based in the United States will still have the ability to withdraw funds during this period.
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If approved, the proposed agreement will address some of the SEC’s concerns while the larger lawsuit continues. The SEC recently filed a lawsuit against Binance and Binance.US, accusing them of trading unregistered securities and alleged mishandling of funds. However, it’s important to note that the proposed agreement does not cover the broader lawsuit.
