Binance Reaches Agreement with SEC to Keep US Customer Assets in Country

By Brad Anderson Brad Anderson has been verified by Muck Rack's editorial team
Published on June 21, 2023

Binance, the largest cryptocurrency exchange in the world, has reached an agreement with the U.S. Securities and Exchange Commission (SEC) to keep the funds of its American customers in the country until a lawsuit against the business is resolved. Pending approval from a federal judge, the arrangement will ensure that only staff of Binance.US will have access to the funds of U.S. customers.

The Securities and Exchange Commission (SEC) sued Binance, its CEO Changpeng Zhao, and the company that runs Binance.US on June 5. The oversight body has leveled numerous allegations against Binance, including market manipulation, money laundering, neglecting to ban U.S. customers, and misleading investors about market monitoring rules. There has been an increased crackdown on the cryptocurrency business by U.S. officials, and this case, along with the one filed against major U.S. exchange Coinbase, is indicative of that.

While the litigation is still ongoing, Binance and the SEC have reached a deal to safeguard the funds of Binance.US users. Binance.US will take measures to safeguard these assets by preventing Binance Holdings employees from gaining access to Binance.US’s private keys for wallets and Amazon Web Services tools. Since Binance is in charge of customer funds, the SEC stressed the significance of these measures to protect investor assets.

The SEC has secured an emergency relief order to safeguard Binance.US users and guarantee withdrawal access to their money. The purpose of the order is to ensure that customer funds are kept separate from Binance’s and its CEO’s personal funds. According to the SEC’s director of enforcement, these restrictions are crucial for the safety of investor funds.

Despite the SEC’s urgent pleas, Binance has refused to budge. However, the business was pleased that the dispute was settled on amicable terms. All Binance-affiliated platforms guarantee the safety of customer funds.

The proposed deal includes more than just asset protection measures. New cryptocurrency wallets can be created on Binance.US that will be inaccessible to Binance staff. The corporation has also agreed to an accelerated discovery timetable and will be providing extra information to the SEC. The SEC’s concerns will hopefully be addressed and the lawsuit settled as a result of these steps.

Binance’s deal with the SEC to keep U.S. customer assets in the nation exemplifies the persistent regulatory scrutiny the cryptocurrency business faces. The assets of Binance.US users and their ability to withdraw funds remain a priority while the SEC litigation moves forward. Binance has shown its attention to protecting investor interests by taking numerous security steps, such as limiting access to assets and creating new wallets.

First reported on Reuters

Originally published on ReadWrite.

By Brad Anderson Brad Anderson has been verified by Muck Rack's editorial team

Brad Anderson is a syndicate partner and columnist at Grit Daily. He serves as Editor-In-Chief at ReadWrite, where he oversees contributed content. He previously worked as an editor at PayPal and Crunchbase.

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