This agreement would be reached to protect customer assets and avoid a complete shutdown of Binance.us.
June 14 marked a pivotal moment for Binance.us as it reached an agreement with the U.S. Securities and Exchange Commission (SEC). Their pact aims to maintain business in lieu of a freeze on its vast assets.
The mediation was handled by U.S. District Judge Amy Berman Jackson, who was keen to secure a mutually beneficial compromise to protect customers' assets without having to shut down the exchange.
At a public hearing on the eve of the agreement, Judge Jackson emphasized the dramatic repercussions a complete shutdown could have both onBinance.us and more broadly on the digital asset market. She deferred ruling on the SEC's request for a temporary restraining order against the company, pending the outcome of legal negotiations.
Despite the heated controversy, Judge Jackson observed that the SEC and Binance.us were not far from reaching an agreement, adding an air of optimism to the proceedings. The tension had intensified after John Reed Stark, a former SEC lawyer, alluded to the conflicts each side hoped to resolve at the hearing.
The brawl stemmed from an emergency motion filed by the SEC against Binance.us earlier in June, centered on allegations against Chang peng "CZ" Zhao, Binance's CEO.
The SEC raised concerns about Zhao's ability to access Binance.US customer funds, claiming that he had transferred a substantial $12 billion in Binance assets via his controlled entity, Merit Peak. But just days before the hearing,
Binance.us and Zhao fired back, denying all allegations of embezzlement and challenging the SEC to identify a single instance of misuse of customer funds.