Binance.US, its global peer Binance Holdings Ltd., and the company’s CEO Changpeng Zhao “CZ” have accused the U.S. Securities and Exchange Commission (SEC) of deliberately misleading the public through statements surrounding the current ongoing securities lawsuit. The charge is part of a motion filed by the cryptocurrency exchange’s legal representatives in the U.S. District Court for the District of Columbia on June 21.
“There is no convincing evidence”
The filing said the SEC’s June 17 statement was “misleading,” as detailed in the press release, and called on the financial regulator to abide by “applicable rules of conduct.” The filing specifically references the SEC’s Director of Enforcement, Gurbir Grewal’s claim that CZ and Binance can “combine customer assets or transfer customer assets at will,” and issued an order requiring all parties involved in the lawsuit to return to the United States.
Lmao @ Binance v. SEC #FireGeneralsCourt: “I wonder, are the BAM assets going offshore? Is this happening? I’m shocked that I’ve asked every lawyer at the SEC that question 5 times now.” SEC: “So assets are not going to Overseas…we won’t… pic.twitter.com/Qkey5HM2ji— Tree of Alpha (@Tree_of_Alpha) June 21, 2023
Binance representatives countered in a June 21 court filing that “the SEC has no evidence that BAM [Binance.US] Customer Assets have been dissipated, mixed or misused in any way. The filing further states that the SEC’s press release appears to be “designed to cause unnecessary confusion in the marketplace, which may harm BAM customers rather than protect them.” “It also runs the risk of contaminating the jury with a misleading characterization of the evidence about the defendant.” If approved by a federal judge, the motion could limit the SEC’s ability to comment publicly on the Binance lawsuit throughout the case, and in particular Comments that “could have significant implications for court proceedings”. As part of its argument, Binance’s legal team cited excerpts from a June 13 hearing in which SEC lawyers acknowledged that there was no evidence Binance.US assets were moved overseas. The motion is part of a broader SEC lawsuit filed on June 5 against Binance, Binance.US and CZ alleging that they offered unregistered securities and neglected to register as exchanges or broker-dealer clearinghouses. At the time, SEC Chairman Gary Gensler claimed that CZ and Binance had deceived investors about the soundness of risk controls, and the regulator pursued forfeiture of ill-gotten gains and other penalties. The U.S. Securities and Exchange Commission (SEC) asked the court to freeze all assets of Binance.US, but a compromise was reached whereby only the exchange’s employees could access client funds during the proceedings. Editor’s Note: This article was written by nft now staff in collaboration with OpenAI’s GPT-4.