In a recent development, Binance.US has struck back at the United States Securities and Exchange Commission (SEC), branding most of their requests as “unreasonable” and “unduly burdensome.” The crypto exchange’s response came just after both parties had concurred to file confidential information under seal.
Attorneys representing BAM Trading Services, the operator of the Binance.US cryptocurrency exchange, submitted documents on September 12 in opposition to the SEC’s quest for additional information. The SEC had previously sought many details from the Binance.US.
The defendants vehemently argued that the SEC’s demands for production and interrogatories extended far beyond reasonable boundaries, falling outside the consent order’s scope. BAM’s legal team contended that the SEC’s pursuit of absolute certainty, including the call for depositions of BAM CEO Brian Shroder and CFO Jasmine Lee, was utterly “unreasonable.”
In their counterargument, BAM’s legal representatives emphasized a crucial point: the SEC’s motion failed to provide any substantiating evidence implicating Shroder and Lee in overseeing customer asset custody and transfers within Binance.US.
Binance.US Challenges SEC And Enforces Protection
The legal team argued that BAM’s CEO and CFO need distinctive insights relevant to the specific areas specified in the expedited discovery clause of the consent order. They underscored BAM’s provision of more suitable witnesses, notably their Chief Information Security Officer, Erik Kellogg. The attorneys stated,
“The burden imposed by these depositions far outweighs their potential benefit, and the discovery sought is disproportionate to the needs contemplated by the consent order.”
The attorneys didn’t stop there. They contended that the SEC still needs concrete evidence to substantiate its unverified claims of asset diversion. According to the defendants, the SEC’s allegations forming the basis of their motion to compel are “misleading and mistaken.”
Moreover, BAM’s legal team emphasized a glaring disparity between the SEC’s “overbroad and abusive approach” and the constrained expedited discovery terms to which the regulator had previously agreed in the consent order.
Interestingly, BAM’s response came hot on the heels of a protective motion that both the SEC and Binance had concurred upon. This motion mandates submitting confidential information under seal, limiting access solely to parties such as the presiding judge, attorneys, plaintiffs, and defendants. This move signals a continued commitment from both sides to protect sensitive information while simultaneously battling it out in the legal arena.
The ongoing clash between Binance.US and the SEC remains a focal point for the cryptocurrency industry, as it could potentially set precedents for regulatory oversight in the United States. As both parties engage in this legal tango, the crypto community eagerly awaits the next twist in this high-stakes showdown.
Related Reading:| Binance.US Embraces Crypto-Only Exchange Model with USDT Transition