Binance, the world’s largest cryptocurrency exchange, is facing increased scrutiny and legal challenges in the United States. The US Securities and Exchange Commission (SEC) recently filed a lawsuit against Binance, leading to a decrease in the company’s trading volume and the resignation of senior management members.
In the midst of this ongoing drama, Binance celebrated a small victory as it won its case against the SEC on September 18, 2023. The commission had raised concerns about Binance’s affiliation with Ceffu, a digital asset hosting platform for financial institutions. Additionally, the regulator accused Binance US of diverting funds from US customers in violation of previous agreements. The SEC requested access to documents and communication with the wallet service provider to further investigate these allegations.
However, during the initial investigation, Binance US struggled to provide a clear explanation of its management of the digital asset wallet. The company also failed to provide consistent information to the SEC regarding the role of Binance Holdings Limited, the parent company of Binance US, and its affiliate, Ceffu, in safeguarding customer assets.
While Binance US successfully defended against the SEC’s request for further review, the court did ask the company to submit additional documents. The presiding judge, Zia Faruqui, expressed uncertainty about Binance US’s control over assets.
These legal battles and regulatory attention have undoubtedly impacted Binance, both in terms of trading volume and leadership. As the situation continues to unfold, it remains to be seen how Binance will navigate these challenges and regain the trust of regulators and investors.
Binance US branch, the world’s largest exchange, in the United States. There have been small victories in the ongoing legal cases.
Binance is starting to get attention from regulators. Since the US Securities and Exchange Commission (SEC) filed a lawsuit in court. In addition, the company’s trading volume decreased. And at the same time, all senior management members submitted their resignations.
SEC case against Binance US
Amid the ongoing drama, Binance won its stance against the SEC today, September 18, 2023. The commission had previously filed a request to investigate Binance US after determining that Ceffu, a digital asset hosting platform for financial institutions In fact it an entity affiliated with Binance.
The regulator also alleged that Binance US had been diverting US customers’ funds out of the country, thereby violating the company’s previous agreement with the commission. The committee has therefore requested to review the documents and communicate specifically with the wallet service provider.
“However, the initial investigation found that Binance US was unable to reliably explain its management of its digital asset wallet. and continues to provide inconsistent information to the SEC regarding the role of Binance Holdings Limited (“BHL” or “ Binance”), the parent company of Binance US, and Binance’s affiliate, Ceffu, in protecting customer assets.
The clear view of the court
Of the latest developments, Binance US has argued that the committee’s request was “excessive,” he said, adding that it was a convenience. US District Court Judge Zia Faruqui denied the SEC’s request for review.
However, the court has asked Binance US to submit additional documents. Judge Faruqui is still uncertain about Binance US’s control over assets
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