SECIn a recent development of the ongoing legal battle between Binance Holdings Limited and the United States Securities and Exchange Commission (SEC), a District judge in Washington, D.C. has encouraged both parties to collaborate. The SEC has been seeking additional information on how customer assets are managed at Binance.US, while Binance.US claims that the agency’s document requests are excessively broad and burdensome.
The SEC raised concerns over the delay in document production by BAM, the company behind Binance.US. According to the regulatory body, BAM has been sluggish in providing requested documents. The agency’s request primarily focuses on gaining insights into customer asset custody, including disaster recovery policies, control of cryptocurrency wallets, and BAM’s financial statements, including its general ledger.
Binance.US claims SEC’s requests are excessive
On the flip side, Binance.US has vehemently opposed the agency’s document requests, describing them as overly broad and unduly burdensome. The cryptocurrency exchange insists that the SEC’s demands exceed reasonable boundaries.
Judge Zia Faruqui urges cooperation
During a recent hearing, Judge Zia Faruqui of the U.S. District Court for the District of Columbia appealed to both parties involved to de-escalate tensions and focus on resolving the matter amicably. The judge emphasized the need to set aside past grievances and encouraged collaboration between Binance.US and the agency.
In response to the agency’s requests, BAM stated its willingness to provide its general ledger as of a mutually agreed-upon date. This gesture marks a potential step towards resolving the dispute over document production.
The agency has also expressed interest in obtaining information about “Ceffu,” a newly rebranded entity allegedly connected to Binance, which appears to have control over customer assets. This aspect of the investigation could shed light on the regulatory concerns surrounding Binance.US.
SEC’s legal action against Binance.US and founder CZ Zhao
The legal battle between the SEC and Binance.US began in June when the agency sued the cryptocurrency exchange and its founder, Changpeng “CZ” Zhao. The agency accused them of violating multiple federal securities laws and misrepresenting the oversight of the Binance.US platform.
Both parties have agreed to a hearing scheduled for October 12, providing an opportunity to address the outstanding issues. Additionally, they have committed to filing a joint status report by October 10, which may offer further insights into the progress of their cooperation and negotiations.
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