As per the recent development, Binance and the SEC have agreed to work on a deal that would allow the exchange to avoid freezing all of its assets. Just recently, it was reported that the US District Judge, Amy Berman Jackson, referred the two entities to a magistrate judge in an effort of laying the foundation for them to work together and eliminate the probability of shutting the exchange down or affecting the funds of the customers. Jackson stated that shutting the exchange down would not only result in terrible consequences for the company but would also greatly affect the digital assets market.
Judge Jackson clarified that she would not come to a final verdict regarding the SEC’s motion for a temporary restraining order until the two parties discuss their business with the magistrate. Currently, it is speculated that the discussions with the magistrate would be held after business hours on June 15. Binance and the SEC were not that far apart when it came to reaching an agreement on the situation.
Prior to Judge Jackson’s decision, the former SEC enforcement attorney, John Reed Stark, tweeted that there was a lot of conflict between the two parties, with both of them wanting to walk out of the hearing. Based on a June 12 memorandum filed ahead of the hearing on the restraining order, Binance denied all allegations of mishandling the funds. Similarly, the exchange accuses the SEC of being unable to identify a single case in which the funds of customers were mishandled.
SEC/Binance Newsflash: Dueling Consent Orders (Read Them Now)
The SEC and the Binance defendants have each submitted draft orders of what each party wants the Judge to order in the SEC/Binance Emergency Asset Freeze Enforcement Action.
There is obviously a lot of conflict… pic.twitter.com/UWjXSgL5lR
— John Reed Stark (@JohnReedStark) June 13, 2023
Binance Would Continue to Pay Operating Costs
As a part of the proposal made, the exchange asked to keep on covering operational costs while pledging that no assets would be transferred or payments made to benefit any Binance entity without the approval of the judge. During the hearing, the attorney of the SEC mentioned that the regulator is open to a narrowly-tailored exception to any freeze that would let Binance cover its operating expenses.
However, the regulator asked the exchange to provide proper accounting of all of its business expenses and professional fees to gain deeper insights regarding what would be required to keep the platform operational. Binance is required to file the necessary details by Wednesday.
