Binance CEO Changpeng Zhao (CZ) has been issued a summons by the U.S. District Court for the District of Columbia following a lawsuit against himself and his exchange on Monday.
The CEO must respond to the summons within 21 days, but is not required to appear in person.
Other entities named in the lawsuit, including Binance and Binance US, must also answer the summons.
“If you fail to respond, judgment by default will be entered against you for the relief demanded in the complaint,” read the filing.
Per the Security and Exchange Commission (SEC)s 136-page filing against Binance on Monday, the commission wants the exchange to “disgorge their ill-gotten gains with prejudgment interest,” and to permanently enjoin the firm from engaging in the crypto and securities trading business.
The lawsuit charged Binance with selling unregistered securities in the forms of BNB and BUSD, as well as operating as an unregistered securities exchange and broker-dealer within the United States.
It also accused the firm of not retaining independence from Binance US, commingling billions of dollars in funds from both firms within Merit Peak – an entity controlled by CZ.
The CEO was not phased by the summons on Wednesday, viewing it as a procedural aspect of the lawsuit.
I was told this is just part of the SEC compliant process. Nothing new.
Also told I won't have to appear in person. No need to FUD. pic.twitter.com/NYUlBCIirG
— CZ Binance (@cz_binance) June 7, 2023
Binance US was issued a restraining order to have its assets frozen by the SEC on Tuesday, pending court approval. The order does not affect the international exchange.
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