Binance.US and the U.S. Securities Exchange Commission (SEC) could potentially come to an agreement that would avoid a full asset freeze. This news comes after the SEC first filed charges against Binance.US and related companies on June 5th. The SEC then requested a restraining order and asset freeze on June 8th.
Judge Amy Berman Jackson’s Decision
Initially, the SEC’s order demanded that Binance.US’s funds be frozen and repatriated. However, Judge Amy Berman Jackson stated in a recent hearing that freezing the funds entirely would have “significant consequences.” She said that she would not approve an asset freeze until both parties reach a compromise agreement with a magistrate judge.
Reports of a June 15th Deadline and a Modified Order
According to separate reports from Yahoo Finance, there is a June 15th deadline for an agreement to be reached. The involved parties have also submitted a modified order that would allow Binance.US’s parent companies – BAM Trading and BAM Management – to keep control of user fiat and crypto assets solely for the purpose of facilitating customer redemptions.
Requirements for the Revised Order
The revised order would require BAM companies to transfer cryptocurrency funds to newly created wallets that are solely controlled by U.S. company members. Furthermore, BAM companies would be required to provide SEC counsel with details related to accounts, balances, customers, and other information. These requirements are related to one of the SEC’s core concerns, namely the possibility that Binance CEO Changpeng Zhao and other executives and companies that exist outside of the U.S. have access to U.S. customer funds.
Binance.US Service Changes
Binance.US previously claimed that the SEC’s request led to its relationships with banking partners breaking down. As a result, it has paused USD withdrawal channels and will work solely with crypto as early as June 13th. The platform’s status page indicates that all USD withdrawal methods are now disabled for American customers, except for ACH transfers, which are labeled “degraded.” It is important to note that this service change only relates to Binance.US and American customers and does not affect users of Binance.com or other global Binance users.
While there is no final agreement yet, the modified order that has been submitted shows progress towards a compromise between Binance.US and the SEC. It remains to be seen whether the involved parties will reach an agreement by the June 15th deadline or if there will be further developments in this ongoing legal battle.