Miguel Lopez Binance US, a prominent cryptocurrency exchange, has appealed to a federal judge to dismiss a request by the U.S. Securities and Exchange Commission (SEC) to freeze its assets. According to a court filing, defense lawyers argue that such an action would impair the operation of the trading platform and obstruct the payment of employees and suppliers.
‘Draconian SEC Relief Unnecessary,’ Argue Binance US Attorneys
As the American branch of Binance, the world’s largest cryptocurrency exchange, Binance US has implored a federal judge to disregard the SEC’s request to immobilize billions of dollars in assets under its control.
The SEC recently pursued court consent to lock down cryptocurrency assets on the platform for the duration of a legal battle with Binance.US, Binance Holdings Ltd., and Changpeng Zhao, Binance’s founder and CEO. The regulator cited concerns about customer fund security.
“If all corporate assets were to be frozen, operations would inevitably come to a standstill,” warned Binance US attorneys in a court filing on Monday, as reported by Bloomberg. They stressed that the exchange would be unable to pay employees and suppliers, adding:
Should there be a complete asset freeze, it is likely that banking partners would stop honoring fund transfer requests, including those for customer redemptions.
When the SEC lodged a lawsuit against Binance, it charged the exchange with “flagrant violation of US securities laws” and “consistent unlawful conduct.” Among the alleged transgressions were customer fund mismanagement and deception of both investors and regulators. However, the defense team countered these allegations, insisting that customer assets are secure and stating:
The severe relief the SEC is seeking is unwarranted.
According to the filing, one of Binance US’s banking partners has already told the crypto platform that it will cease holding its assets as of June 14. It also suspended all activity on the company’s account until the court makes a decision on the SEC’s motion.
On Thursday, Binance US notified customers that it would be halting dollar deposits and withdrawals. It encouraged users to withdraw their US dollar holdings by June 13 as the platform prepares to shift to a crypto-only trading model.
What are your thoughts on the potential halt of Binance US operations if an asset freeze occurs? Please share your opinions in the comments section below.
Frequently Asked Questions (FAQs) about Binance US Asset Freeze
Q: Why is Binance US urging a federal judge to reject the SEC’s request to freeze its assets?
A: Binance US is concerned that if its assets are frozen, it won’t be able to maintain its trading platform or pay employees and vendors, which would lead to a halt in operations. They believe the SEC’s requested relief is unnecessary and would have a detrimental impact.
More about Binance US Asset Freeze
- Bloomberg: Binance US Urges Judge to Reject SEC Request to Freeze Assets
- SEC: Lawsuit Against Binance
- Binance US Announcement on Suspending Dollar Deposits and Withdrawals (Replace “xxxxxxx” with the specific announcement URL)
3 comments
SEC going after binance, accusing them of violative conduct! but binance lawyers say no need for draconian relief! it’s a mess, hope binance can keep going!
binance us really needs the judge to reject SEC’s req to freeze assets! it’s gonna ruin their op and they can’t pay emploees/vendors!! not good, sec should chill!
binance’s assets might get frozen, that’s bad news for everyone! it will stop the trading platform and no more payments. hope this gets resolved soon!