SEC and Binance US to negotiate deal

Binance US and the Securities and Exchange Commission (SEC) have agreed to seek an arrangement to prevent the freezing of the exchange's assets. On June 14, U.S. District Judge Amy Berman Jackson referred the two parties to a magistrate judge to negotiate a solution safeguarding customer funds without necessitating the exchange's closure.

Jackson underlined that a total shutdown would have significant repercussions not only for Binance US, but also for the broader digital asset markets. She decided to hold off on a final verdict regarding the SEC’s request for a temporary restraining order until the parties had discussed the matter with the magistrate. An update on the progress of these negotiations is scheduled for June 15.

The judge also observed that the SEC and Binance US were “not that far apart” on reaching a compromise. Prior to her decision, former SEC enforcement attorney John Read Stark tweeted about the apparent conflict between the parties, but affirmed a compromise could be achieved.

The SEC had previously filed an emergency motion for a temporary restraining order against Binance US on June 6. They alleged that Binance CEO Changpeng “CZ” Zhao had access to and moved $12 billion of Binance’s funds through an entity under his control, Merit Peak.

However, both Binance US and Zhao vehemently denied these allegations in a joint memorandum submitted on June 12. They argued that the SEC was “unable to identify a single instance” of misuse of customer funds, concluding that the so-called 'emergency' was a contrivance by the SEC for its own ends.