In a dramatic turn, the Securities and Exchange Commission (SEC) has filed an emergency motion, requesting a federal judge in Washington, D.C., to freeze the assets of Binance’s U.S. subsidiary.
The motion, submitted late Tuesday night, aims to compel the repatriation of both fiat currency and cryptocurrency assets held by customers on the BinanceUS crypto asset trading platform.
According to reports, the freezing order specifically targets Binance’s two U.S. holding companies while leaving the non-U.S. regulated international exchange unaffected. The order would impact numerous accounts held at financial institutions such as Axos Bank, the now-defunct Silvergate Bank, Prime Trust, and others.
The SEC’s lawsuit against Binance and its founder, Changpeng Zhao, alleges thirteen separate counts of fraud, improper commingling of funds, and operating as an unregistered broker, dealer, and clearing house.
The regulator argues that the emergency restraining order is necessary to prevent the dissipation of available assets, given the defendants’ history of violative conduct and disregard for U.S. laws.
Furthermore, the order demands that Zhao demonstrate why a preliminary injunction should not be imposed against him and his two holding companies. It also prohibits all three entities from destroying any evidence.
BinanceUS Assures User Asset Safety & Operational Functioning
BinanceUS swiftly responded to the SEC’s actions, assuring its users that their assets remain safe and secure. The platform stated that it continues to operate normally, with deposits and withdrawals functioning without any issues.
In a series of tweets, BinanceUS criticized the SEC’s motives, claiming that the filing of the motion was an attempt to gain an advantage in litigation rather than genuinely prioritize customer asset safety. The company expressed disappointment in the SEC’s actions, asserting that the allegations against them are baseless.
The crypto exchange further accused the SEC of engaging in political grandstanding and land grabbing rather than protecting consumers or supporting business growth in the United States.
BinanceUS remained steadfast in its belief that the SEC’s allegations lack merit and expressed confidence in its ability to defend itself in court.
Nevertheless, as the ongoing legal dispute between the SEC and the leading exchange continues, their customers will be closely observing the developments, anticipating a prompt resolution that ensures the protection of their assets and maintains the platform’s operations intact.
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