Binance.US and the United States Securities and Exchange Commission (SEC) have come to an agreement on a plan that will prevent the exchange from having to freeze all of its assets.
On June 14, according to Bloomberg, U.S. District Judge Amy Berman Jackson referred the two organizations to a magistrate judge to attempt to reach an agreement that would guard customer funds without having to shut down the exchange.
Jackson asserted at a June 13 hearing that “shutting it down entirely would have considerable repercussions not only for the company but for the digital asset markets as a whole.”
Judge Jackson declared that she would not make a definitive ruling on the SEC’s motion for a temporary restraining order until the two parties had addressed the predicament with the magistrate.
An update regarding the negotiations conducted with the magistrate has been planned for the close of the workday on June 15.
She also observed that the SEC and Binance.US were “not that far from” coming to a consensus regarding the issue.
Prior to Judge Jackson making her ruling at the hearing, ex-SEC enforcement lawyer John Read Stark made known to his 20,000 Twitter followers that there was “a lot of disagreement between what each side” was hoping to accomplish from the hearing.
“Stark explained that this does not preclude the judge from issuing a ruling that would involve a compromise and finding a mutually agreeable solution,”
The SEC is unable to locate Binance CEO Changpeng Zhao, and is asking the court for an alternative method of service.
On June 6, the SEC submitted an urgent request for a temporary restraining order against Binance.US, alleging that Binance CEO Changpeng Zhao (CZ) had the potential to access customer funds of Binance.US.
The regulator claimed Zhao had shifted $12 billion of Binance’s resources through a firm he owned called Merit Peak.
In a joint memorandum submitted prior to the hearing on the restraining order on June 12th, both Binance.US and Zhao denied any allegations of funds being mismanaged. They asserted that the SEC was unable to point out a single instance of Binance.US customer funds being abused.
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