The court has directed the SEC to collaborate with Binance on developing a plan to protect assets while allowing the company to conduct business as usual.
The SEC sued Binance on June 5th, requesting a total freeze on all Binance.US assets, citing an alleged proclivity to comele customer cash and shift them overseas.
Granting this request would not only have been devastating to Binance’s operations – not to mention overkill, given that the allegations had not been proven in the least – but it would have also harmed the firm’s reputation to the point where Binance.US would have struggled to recover if proven innocent.
Binance’s legal counsel.The US urged that the SECs’ motion be denied at away, claiming that they “will not accept the death penalty eight days into the case.”
Furthermore, in a 42-page memorandum filed jointly by Binance.US and CZ, the defendants chastised the SEC for making baseless claims, citing the lack of unambiguous evidence of misconduct that would support an immediate asset freeze.
“There is no ‘emergency’ here at all, other than the one manufactured by the SEC for its own purposes.”
In response to both the SEC’s motion and Binance.US’s legal team’s arguments, the judge presiding over the case refused the agency’s request. Instead, Binance.US and the SEC have been directed to collaborate in order to develop a plan that will allow the exchange to continue functioning as usual while guaranteeing that customer assets remain safe and, most crucially, under U.S. jurisdiction.
“Shutting it down completely would create significant consequences not only for the company but for the digital asset markets in general. (Work it out) – The nitty-gritty of it is better handled by you than by me.”
To establish a solution, the SEC wants any client assets hosted elsewhere to be returned to the United States.
Binance.So far, the US has not opposed to this idea, requesting simply the ability to use, withdraw, and transmit assets sufficient to cover operational costs and salaries.
If this plan is accepted, Binance.US agrees not to make any transfers or payments to other Binance entities without the express permission of the judge presiding over the case.
The judge has already asked Binance.US to give a preliminary breakdown of recurring expenses and operational costs.