Judge Amy Berman Jackson of the United States district court has granted approval for an agreement reached between Binance.US, Binance, and the U.S. Securities and Exchange Commission (SEC) on June 17. This agreement dismisses a previous temporary restraining order (TRO) that aimed to freeze all assets held by Binance.US.
Earlier, on June 14, Judge Jackson expressed her preference for the parties involved to independently reach an agreement rather than relying on her ruling. It has been reported that the parties successfully reached an agreement on June 16.
Binance.US took to Twitter to share their satisfaction with the court’s decision, stating that they are pleased about the court’s decision to deny the SEC’s request for a TRO and asset freeze on our platform, which was clearly unjustified based on both the facts and the law. Under the terms of the approved agreement, only Binance.US employees will have access to client funds until the litigation is resolved. Customers based in the United States will still be able to withdraw funds during this period.
Additionally, the agreement between the cryptocurrency exchange and the U.S. regulatory body ensures that Binance global officials are restricted from accessing private keys of wallets, hardware wallets, or obtaining root access to Binance.US’s Amazon Web Services tools.
BinanceUS Deny Allegations of Fund Mismanagement
Binance.US responded to allegations of funds mismanagement by stating that the SEC has never presented any evidence of customer asset misuse. They further highlighted that during a court session earlier in the week, SEC lawyers admitted to lacking any evidence suggesting such occurrences.
Former chief of the SEC’s Office of Internet Enforcement, John Reed Stark, commented on the case via Twitter, noting a notable provision in the agreement regarding the repatriation of specific assets to the United States.
According to the agreement, “Defendants shall repatriate to the United States, transfer to BAM Trading, and confirm that BAM Trading maintains possession, custody, and control in the United States of all fiat currency and crypto assets that are deposited, held, traded, or accrued by customers[…].”
Additionally, the agreement emphasizes that BinanceUS must promptly take action to ensure a verified written accounting of accounts associated with BAM entities valued above $1,000.
On June 6, the SEC filed an emergency motion for a temporary restraining order against BinanceUS, accusing Binance CEO Changpeng Zhao of having access to Binance.US customer funds in a lawsuit. The regulator alleged that Zhao moved $12 billion of Binance’s funds through an entity under his control named Merit Peak.
Ahead of the hearing on the restraining order, BinanceUS and Zhao submitted a joint memorandum refuting any mishandling of funds. They asserted that the SEC has not provided evidence of a single instance where Binance.US customer funds were misused.