- The U.S. Securities and Exchange Commission (SEC) is seeking court approval to freeze cryptocurrency assets linked to Binance US, citing customer safety concerns.
- The SEC has filed an emergency motion for a temporary restraining order against BAM Management US Holdings and BAM Trading Services, the entities managing Binance US, to prevent the destruction, alteration, or concealment of pertinent records.
In a significant move, the U.S. Securities and Exchange Commission (SEC) is actively seeking court approval to freeze cryptocurrency assets associated with Binance US. This action, aimed at ensuring customer asset safety, underscores the SEC’s commitment to regulatory oversight in the rapidly evolving cryptocurrency industry.
On Tuesday, the SEC filed an emergency motion requesting a temporary restraining order against BAM Management US Holdings and BAM Trading Services. These entities are primarily responsible for managing Binance US, a subsidiary of the globally recognized cryptocurrency exchange, Binance. The restraining order seeks to freeze the assets under their control, marking a decisive action by the SEC.
The order explicitly prohibits Binance from engaging in activities that could lead to the destruction, alteration, or concealment of relevant records. A further court order issued by the SEC stipulates that BAM Management or Changpeng Zhao (CZ), Binance’s head, must provide compelling reasons to avoid the imposition of a preliminary injunction.
The SEC maintains that this restraining order is crucial to protect customer funds. The regulator’s filing notes that “this relief is necessary on an expedited basis to ensure the safety of customer assets.” This move follows the SEC’s lawsuit against Binance and CZ, accusing them of operating an unregistered exchange, brokerage, and clearing house.
This news also follows the SEC’s lawsuit against Coinbase, another major cryptocurrency exchange. Similar to its allegations against Binance, the SEC accuses Coinbase of offering unregistered securities and allowing U.S. residents to use its global platform.
The SEC believes that given the defendants’ years of alleged violative conduct, evasion of regulatory oversight, and unresolved questions about financial transfers and customer asset custody and control, the restraining order is necessary. The SEC asserts that the court has the jurisdiction to hear this case and compel the defendants to appear.
The SEC’s actions to freeze Binance US cryptocurrency assets highlight the regulator’s commitment to customer safety. As the situation unfolds, it will be crucial to observe how these dynamics shape the future of cryptocurrency regulation and the broader industry.
