Binance US Counters
Binance.US has submitted its defense ahead of the scheduled June 13 hearing regarding the potential freezing of its funds. The cryptocurrency exchange is urging the court to reject the Securities and Exchange Commission’s (SEC) proposed temporary restraining order, asserting that such action would effectively cripple its operations. In a filing dated June 12, Binance.US criticized the SEC’s emergency motion, deeming it excessively burdensome and draconian.
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Binance.US Challenges the SEC’s Approach
Binance.US, in its filing, challenged the SEC’s entire approach to the legal action, claiming that all of the regulator’s claims are unfounded. The exchange pointed out that the SEC has not yet identified a single security trading on its platform, despite alleging that at least 68 cryptocurrencies are securities. Binance.US highlighted the fact that numerous cryptocurrency exchanges, including itself, have operated in the United States for years without interference from the SEC. This, according to the filing, contradicts the claim that they are unequivocally subject to securities laws.
Cooperation with the SEC Investigation
Binance.US emphasized that it has made substantial efforts to cooperate with an ongoing SEC investigation that commenced on December 20, 2020. The exchange provided over 700,000 individual communications and extensive data on its day-to-day operations as part of the investigation. Binance.US underscored its cooperation as evidence of its commitment to addressing the SEC’s concerns.
SEC’s Allegations and Binance.US’s Response
The SEC launched a significant legal action against Binance and its affiliates on June 5, alleging that the exchange failed to register as a securities exchange and permitted U.S. customers to trade cryptocurrencies deemed securities. The regulator also accused Binance CEO Changpeng Zhao (CZ) of having access to Binance.US customer funds and purportedly moving $12 billion through a privately-controlled entity named Merit Peak.
In response, Binance.US vehemently denied the SEC’s allegations. The exchange stressed that the SEC has failed to identify any instances of mishandling or misuse of customer assets. Binance.US argued that the SEC’s portrayal of the situation as an emergency is manufactured for its own purposes, asserting that no genuine emergency exists.
Conclusion
Binance.US has submitted its defense against the SEC’s motion to freeze its funds, strongly disputing the regulator’s claims. The exchange argued that the proposed temporary restraining order would not only harm its customers but also hamper its ability to defend itself in the ongoing litigation. Binance.US further criticized the SEC’s overall approach, highlighting the absence of identified securities on its platform and citing the long-standing operation of cryptocurrency exchanges without SEC interference. The upcoming hearing on June 13 will determine the outcome of the SEC’s motion and shape the future course of action for Binance.US.
