Sunday, June 16, 2024

SEC and Binance US Reach Temporary Agreement for Enhanced Asset Access

“Binance, Binance.US, and SEC Agree on Temporary Access Limits for Customer Funds”

In a significant development, Binance, Binance.US, and the United States Securities and Exchange Commission (SEC) have reportedly reached an agreement on June 16th, Friday, to temporarily restrict access to customer funds exclusively to Binance.US employees. This move comes as a response to a motion filed by the SEC, seeking to freeze all of Binance.US’s assets during the ongoing legal proceedings.

According to reliable reports, the proposed agreement, which awaits approval from the overseeing federal judge, outlines a set of measures aimed at preventing any access by Binance officials to private keys of wallets, hardware wallets, or root access to Binance.US’s Amazon Web Services tools. Additionally, the agreement mandates that the U.S.-based crypto trading platform disclose comprehensive information on business expenses, including estimated costs, in the coming weeks.

The SEC’s concerns primarily revolve around the potential risk of funds being transferred offshore or vital records being deliberately destroyed. However, Binance.US’s legal representatives strongly opposed the idea, arguing that a complete freeze on all assets would be tantamount to imposing an excessively severe “death penalty” on the company.

During a recent hearing, U.S. district court judge Amy Berman Jackson advised the involved parties that reaching an agreement on a proposed stipulation would be more beneficial than relying on the court to issue a restraining order. The judge emphasized that a temporary restraining order only remains effective for a limited duration of two weeks, which may not be sufficient for a comprehensive hearing, especially considering the extensive volume of submitted exhibits, totaling over 4,000 pages.

The proposed agreement encompasses various additional provisions, including the creation of new crypto wallets by Binance.US that will be inaccessible to employees of other Binance entities. Moreover, Binance.US commits to providing additional information to the SEC and agrees to an accelerated discovery schedule. Importantly, U.S.-based customers will retain the ability to withdraw funds throughout this period.

If approved, the proposed agreement will partially address the SEC’s concerns while the broader lawsuit continues. The SEC recently sued both Binance and Binance.US for trading unregistered securities and alleged commingling of funds along with poor practices. However, it is important to note that the proposed agreement does not cover the broader lawsuit itself.

Read Also: Macro Guru Raoul Pal Forecasts Exponential Crypto Growth, Disregards Current Selloff as Noise

Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.

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