In a significant development, the United States District Court has approved an agreement between Binance.US, Binance, and the Securities and Exchange Commission (SEC). This agreement dismisses the previous temporary restraining order (TRO) that would have frozen all Binance.US assets. The court's decision allows Binance.US to continue its operations under certain conditions until the litigation is resolved. This article provides an overview of the approved agreement, the key provisions it entails, and the implications for Binance.US and its customers.
The Approved Agreement
United States Judge Amy Berman Jackson approved the agreement on June 17, following negotiations between Binance.US, Binance, and the SEC. The agreement grants temporary measures to ensure the protection of customer funds and the resolution of the ongoing litigation. Notably, the court did not grant the SEC's request for a TRO and freeze of assets on the Binance.US platform, which was deemed unjustified by both the facts and the law.
Key Provisions of the Agreement
Under the approved agreement, specific measures are implemented to address the SEC's concerns and protect customer funds. These provisions include:
Limited Access to Customer Funds: Only Binance.US employees will have access to client funds until the litigation is resolved. This measure aims to ensure the security and integrity of customer assets during the legal proceedings.
Restriction on Binance Global Officials: The agreement prevents any access by Binance global officials to private keys of wallets, hardware wallets, or root access to Binance.US's Amazon Web Services tools. This restriction helps maintain the separation of Binance.US's operations from its global counterpart.
Asset Repatriation: The agreement mandates the repatriation of certain assets to the United States and their transfer to BAM Trading, with confirmation that BAM Trading maintains possession, custody, and control of the assets in the United States. This provision aims to ensure the proper handling of fiat currency and crypto assets deposited, held, traded, or accrued by Binance.US customers.
Accounting of BAM Entities: Binance.US must provide a verified written accounting of accounts related to BAM entities valued greater than $1,000. This requirement seeks to enhance transparency and accountability in the financial operations of Binance.US.
Implications for Binance.US and Customers
The approved agreement provides temporary relief for Binance.US, allowing the exchange to continue its operations while the litigation progresses. It ensures that customer funds remain accessible for withdrawals by U.S.-based customers throughout this period. The agreement also emphasizes the SEC's acknowledgment that no evidence has been presented regarding the misuse of customer assets. Former chief of the SEC's Office of Internet Enforcement, John Reed Stark, highlighted the agreement's provision on repatriation of assets to the U.S. as particularly interesting.
Conclusion
The U.S. court's approval of the agreement between Binance.US, Binance, and the SEC marks an important milestone in the ongoing legal battle. The approved temporary measures provide a framework for asset access and address the SEC's concerns, allowing Binance.US to continue its operations while litigation is underway. The agreement emphasizes the commitment to safeguarding customer funds and enhancing transparency in financial operations. As the lawsuit progresses, Binance.US and its customers will navigate the legal landscape with the guidance of the approved agreement.
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URL: https://cointelegraph.com/news/us-court-approves-sec-binanceus-agreement
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