Binance.US and the US Securities Exchange Commission (SEC) could reach an agreement that could prevent a full asset freeze, Bloomberg said on June 13.
Judge demands compromise
The SEC first filed charges against Binance.US and related companies on June 5. It then requested a restraining order and asset freeze on June 8.
While the SEC’s initial order called for Binance.US assets to be frozen and repatriated, Judge Amy Berman Jackson said at a recent hearing that freezing assets completely would have “significant consequences”. She said she would not approve an asset freeze until both sides reach a compromise with a magistrate.
Separate reports from Yahoo Finance suggest a June 15 deadline for that agreement.
The affected parties have also submitted an amended order that will allow Binance.US parent companies – BAM Trading and BAM Management – to retain control of users’ fiat and crypto assets solely for the purpose of facilitating customer redemption.
The order would also allow BAM companies to pay ordinary operating expenses; the SEC or the court would rule on specific details related to this in the future.
However, the revised order requires BAM companies to transfer cryptocurrency funds into newly created wallets controlled solely by US corporate members. In addition, BAM companies would be required to provide SEC advisers with details regarding accounts, balances, customers and other information.
Those requirements address one of the SEC’s main concerns, which is the possibility of Binance CEO Changpeng Zhao and other executives and companies existing outside the US accessing US client funds.
Binance.US has ended USD support
The order has not been approved in any way. However, Binance.US previously claimed that the request alone caused relationships with banking partners to break down.
Binance.US said it would pause USD withdrawal channels and have been working exclusively with crypto since June 13. The platform’s status page indicates that all USD withdrawal methods are now disabled (except for ACH transfers, which are labeled “degraded”).
That service change only affects Binance.US and US customers. It does not cover users of Binance.com or other worldwide Binance users.
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