SEC and Binance.US to negotiate deal to avoid total asset freeze

Binance.US and the United States Securities and Exchange Commission (SEC) have agreed to work on an arrangement that will allow the exchange to avoid freezing all of its assets.

On June 14, Bloomberg informed of US District Judge Amy Berman Jackson referred the two organizations to a magistrate judge to work toward a settlement arrangement that would protect customer funds without shutting down the exchange.

“Shutting it down completely would have significant consequences not only for the company, but for the digital asset markets in general,” Jackson said at the June 13 hearing.

Judge Jackson noted that she would not be able to make a final decision on the SEC’s motion for a temporary restraining order until both sides have worked through the situation with a magistrate.

An update on the conversation with the magistrate is scheduled for over business hours on June 15.

Additionally, he noted the SEC and Binance.US seemed “not too far apart” when it comes to reaching an agreement on the matter.

Before Judge Jackson reached his decision in the hearing, former SEC enforcement attorney John Reed Stark informed his 20,000 Twitter followers that there is “a lot of conflict between each side” to get out of the hearing.

SEC/Binance Newsflash: Duel Consent Orders (Read Them Now)

The SEC and Binance Defendants have submitted each party’s draft orders for the Judge’s Order in the SEC/Binance Emergency Asset Freeze Enforcement Action.

There is obviously a lot of controversy… pic.twitter.com/UWjXSgL5lR

— John Reed Stark (@John Reed Stark) June 13, 2023

“That doesn’t mean judges can’t order a compromise and find common ground,” Stark explained.

Connected: SEC fails to find Binance CEO Changpeng Zhao, seeks ‘substitute service’ from court

The SEC Filed an Emergency Motion for a Temporary Restraining Order on Binance.US on June 6th accused Binance CEO Changpeng Zhao (CZ) for being able to access Binance.US customer funds.

The regulator alleged that Zhao transferred $12 billion of funds to Binance through an entity called Merit Peak.

In the joint of June 12 memo Ahead of the hearing on the restraining order, both Binance.US and Zhao denied claims that the funds were ever mishandled. He accused the SEC of being “unable to identify an instance” in which Binance.US customer funds were ever misused.

“In fact, there is no ’emergency’ here, other than one created by the SEC for its own purposes.”

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