On Friday, Binance, its subsidiaries and the Securities and Exchange Commission (SEC) came to an agreement to keep customer fund access exclusively for Binance.US employees in the near future. The proposed terms address the SEC’s motion for a temporary restraining order but still require a judicial greenlight.
Binance and SEC reach provisionary terms
Binance.US is set to take steps to ensure that no Binance Holdings (global exchange) officials have access to private keys for its various wallets, hardware wallets, or root access to Binance.US’s Amazon Web Services tools, according to the proposed terms. The agreement still requires formal approval by the federal judge overseeing the case, who had given a June 15. deadline for the SEC and the crypto exchange to come to a resolution on Wednesday, June 14.
Furthermore, the crypto platform’s US arm will publish full information about its business expenses, including expected costs in the weeks ahead.
The proposed deal comes in response to an SEC motion to freeze all Binance.US assets as it pursues the exchange on securities violations. The regulator was concerned about funds potentially being moved outside of the US’ jurisdiction, or possible records destroyed if it was not granted a temporary restraining order (TRO). Binance.US’ legal team pushed back saying that freezing assets would be a ‘death penalty’.
Columbia District Court Judge Amy Berman Jackson told both parties that it would be better to come to an amicable agreement on a provisory basis instead of crafting a restraining order, noting that a TRO comes with a two week limit for an in-depth hearing. She said that two weeks would not be enough time to prepare, given that over 4,000 pages of legal documentation has already been fled by involved parties.
Other provisions will see Binance.US create new wallets that the exchange’s employees cannot access, as well as providing the SEC more information on an expedited schedule.
US customers will still be allowed to withdraw funds during this time.
If approved, the agreement will resolve some of the SEC’s stated concerns as the regulator’s wider-reaching lawsuit goes through the legal process. Last Monday, the SEC charged Binance and Binance.US with issuing and trading unregistered securities, as commingling user funds and other malpractices.
The proposed agreement does not go into detail about the broader suit.
Bitcoin recovered 5.5% on Friday, and trades at $26,500 at the time of writing.
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