Recently, a US court has granted Binance US permission to invest certain customer fiat funds in US Treasury Bills. This move comes after the exchange requested court approval to invest about $40 million in $10 million increments over four weeks. The investments will be made through a trading account on TreasuryDirect in US Treasury bills that will mature on a rolling four-week basis. Judge Amy Berman Jackson approved the exchange to invest its customer fiat funds, provided it maintains enough funds on its platform to meet all expected customer withdrawal requests. Moreover, the judge required the exchange to update its terms of use to notify customers accordingly.
Security Measures and Regulatory Compliance
In addition to granting permission for investments, Judge Jackson also authorized Binance US to engage third-party investment advisors to manage its corporate assets. The exchange was also given the green light to transfer its custodied assets to a non-affiliated third-party custodian in the United States. However, strict conditions were set in place to ensure the security of the assets. The judge specified that the new private and administrative keys for the wallets must be maintained and controlled solely by employees in the United States or by the third-party custodian in the United States.
Combatting Financial Scams in the Crypto Industry
Meanwhile, in a separate incident, the global Binance exchange assisted the US Federal Bureau of Investigations (FBI) San Diego in investigating a pig butchering scam that led to the recovery of $2.5 million in USDT. The scam involved fraudsters using manipulative tactics to lure victims into investing in fraudulent crypto schemes. Victims are often persuaded to make additional payments, only to have their assets stolen by the scammers. Such schemes have become increasingly prevalent, with over $2 billion being stolen via similar scams in 2022, according to the US Department of Justice.
These recent events highlight the crucial importance of legal compliance and stringent security measures in the crypto industry. Regulatory authorities play a vital role in ensuring that exchanges like Binance US operate within the bounds of the law and protect their customers’ funds. Additionally, combatting financial scams and fraudulent schemes requires continuous vigilance and collaboration between industry players and law enforcement agencies. Ultimately, prioritizing legal compliance and security measures is essential for building trust and maintaining the integrity of the crypto industry.