Breaking: US SEC wants to freeze Binance.US’ assets

• The US SEC has filed for a restraining order seeking to freeze the assets of BAM trading and other entities
• The commission also seeks to strip away any access Binance and CZ had over US customer funds

The United States Securities and Exchanges Commission (SEC) is moving to get its hands on the assets of Binance.US – the American branch of the world’s largest crypto exchange. This action was mentioned in a restraining order filed today.

The commission sued Binance, Changpeng Zhao (CZ), and Binance.US on 5 June for breaching securities laws placed in the US.  Along with this, the commission claimed that Binance.US had commingled customers’ money with an entity that is controlled by CZ. In the same lawsuit, the regulatory authority listed 10 cryptocurrencies as securities including Solana [SOL] and Cardano [ADA].

Binance.US: SEC moves to take control

Notably, the filing stated that the restraining order should freeze the assets of the exchange in order to “preserve the status quo, prevent dissipation or transfer” of the funds to a different jurisdiction. Additionally, it will be able to protect the court’s “ability to award relief in the form of disgorgement, prejudgement interest, and civil penalties.” The filing read,

“Defendants BAM Management and BAM Trading and their agents servants, employees, attorneys-in-fact, and those persons in active concert (….) shall hold and retain within their control, and otherwise prevent nay disposition, transfer, pledge, encumbrance, assignment, dissipation, concealment, or other disposal whatsoever of any of their funds or other assets or things of value (…)”

Furthermore, the filing stated that customer funds should be in sole control of BAM Trading within five days of the court’s approval. The SEC is mainly seeking to take away Binance and its CEO Zhao’s authorization or involvement in the transfer or withdrawal of US customer assets. The filing further said

“ensure that neither Defendant Binance, nor Defendant Zhao, nor any of the Binance Entities obtains possession, custody, or control over Customer Assets, including by being designated as an account holder or signatory of any account of wallet holding Customer Assets without first obtaining leave of the Court”

Moreover, the filing seeks Binance.US to transfer all crypto assets to a different wallet with new private and administration keys. The commission also seeks that the new details should not be passed over to Binance, CZ, or related entities. This process should be completed within 30 days of the court passing the restraining order.

After the approval, the CEO and CFO will have to give written approval of any transfers amounting to over $100,000. Additionally, Binance.US’ could transfer its staking service to either BitGo or Aegis if it satisfies SEC’s conditions.

In response to the SEC’s claims, Binance.US took to Twitter to state their side of the story. The tweet stated that The filing of the preliminary injunction was unwarranted. The U.S. arm of the crypto exchange also expressed disappointment about the situation.

Adding to the response by Binance.US, CZ took to Twitter to clarify that the actions of the SEC only affect Binance.US and not Binance.com. He further reassured the community that their funds were safe.