Binance.US, SEC Ordered to Start Negotiations Wednesday Amid Asset Freeze Tussle

A U.S. federal judge on Tuesday rebuffed SEC's request to order a freeze on Binance.US' assets – provided the parties could agree on limits.

AccessTimeIconJun 14, 2023 at 1:58 p.m. UTC
Updated Jun 14, 2023 at 2:00 p.m. UTC

A U.S. federal judge has ordered crypto exchange Binance, its local affiliate Binance.US and the Securities and Exchange Commission (SEC) to attend a mediation conference on Wednesday to hash out restrictions on operations as the regulator's case against the companies continue.

While the SEC alleged in its suit that the Binance entities sold unregistered securities in violation of U.S. laws and later moved to obtain a temporary restraining order to freeze Binance.US' assets, D.C. District Court Judge Amy Berman Jackson said during a Tuesday hearing that there was "absolutely no need" for such an order if the parties could agree on limits.

Ahead of Tuesday's hearing, Binance.US said freezing the company's assets would "effectively end" the business. Negotiating limits would in the interim allow the firm to continue operations.

Judge Jackson during the hearing showed concern that a requirement to set up another hearing within two weeks did not give the court enough time to go through the thousands of pages in documents and exhibits received by the parties involved.

"What I'm looking for is some variation of what we already have. I think the nitty gritty of it ... is better handled by all of you than by me," Judge Jackson said during the hearing, adding an order crafted by her may not satisfy either party.

In a Wednesday order, the first mediation session was set for June 14 at 2:45 PM Eastern Time before Magistrate Judge Zia M. Faruqui who has, as a former prosecutor, conducted several federal crypto investigations.

Faruqui has previously praised blockchain tracing technology as a powerful tool and called the fear among regulators of "unhosted" crypto wallets held outside of exchange "fiction, not fact."

Nikhilesh De and Jack Schickler contributed reporting.

Edited by Nikhilesh De.


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