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U.S. Federal Court Judge Amy Berman Jackson just dismissed Binance’s request to limit SEC’s use of language concerning Binance.US’s management of customer funds in press releases.
The exchange had raised concerns that such language could harm its stature during the trial. However, the judge rebuffed this request, indicating that SEC’s communication in press releases will not be curtailed.
U.S. federal judge dismisses #Binance's request to limit SEC's language in press releases on Binance US.
— Antonio Censabella (@antoniocensabel) June 26, 2023
Judge Amy Berman Jackson of DC District Court overseeing the U.S. SEC’s case against Binance.US, dismissed the claims, asserting that the court’s role does not involve “wordsmithing” public statements made by either party involved in the case.
Judge Jackson ruled that it is not currently evident that court intervention is necessary or appropriate, nor is it clear that the SEC’s public relations efforts thus far will significantly impact the proceedings in this case.
Binance Challenges SEC’s Lawsuit, Prepares for Court Battle
BAM Trading, the operating entity of Binance.US has complained about SEC’s press release on Friday, expressing concerns about the SEC’s “misleading extrajudicial statements.”
Additionally, Binance’s lawyers have stated that the SEC’s press release intentionally creates unnecessary confusion in the marketplace, which could harm BAM customers rather than ensure their protection.
“It also risks tainting the jury pool with misleading descriptions of the evidence concerning the Defendants,” they added.
The company’s lawyers maintained that there is no evidence of dissipation, commingling, or misuse of BAM customer assets. The judge set a deadline of September 21 for Binance to respond to SEC’s allegations. The SEC must reply to company’s pleading by November 7.
Binance’s complaint to court comes as it prepares to fight against SEC in court. On June 5, the SEC sued Binance, the world’s largest crypto exchange, by trading volumes, alleging violations of federal securities laws by the company and its CEO, Changpeng “C.Z.” Zhao, according to the complaint.
The SEC has actively voiced its mission to protect investors from a risky and non-compliant industry. In line with this stance, the Commission took legal action against several crypto companies, demonstrating its commitment. Last month, the Commission filed a motion with the court, compelling Binance to produce documents related to its activities.
The court’s decision to deny Binance’s request upholds the SEC’s investor protection mandate. Moreover, it enables the SEC to conduct its investigation without external interference.
Binance.US Resumes Operations with Restrictions Amid Ongoing Lawsuit
In a recent development, the exchange resumed USD withdrawals but warned about a potential future suspension. Additionally, the exchange plans to remove most USD advanced trading pairs while introducing new Tether (USDT) advanced trading pairs.
This just in from https://t.co/jgWZN7nv0j: While USD withdrawal remains fully operational on the platform today, As part of our shift to crypto-only trading, we will remove most USD Advanced Trading pairs from our platform on June 26. Thank you SEC &Trad-Fi.
— MysticRaven11 (@Mystic_raven11) June 23, 2023
Binance.US successfully resolved delayed U.S. dollar withdrawals, which had caused disruptions following the lawsuit filed by the U.S. Securities and Exchange Commission (SEC) against Binance and its CEO Changpeng Zhao, resulting in frozen assets. On June 17, the court granted permission for the exchange to resume its operations in the U.S., albeit with certain conditions.
However, by then, the exchange had already experienced the departure of its banking partners because of the suspension of USD deposits. The exchange actively works to identify new partners while urging users to convert their USD holdings to stablecoins.
Importantly, the platform will automatically convert dollars to USDT stablecoin at a later date, but this will only apply to users who cannot make the conversions within the specified timeframe.
They made these statements in response to complaints regarding delayed or stuck withdrawal requests. Binance.US has been transparent, stating that they expect to resolve the issue within the next “five business days.” Furthermore, users who have reported filing withdrawals are requested to resubmit their applications.
Binance.US has obtained court consent to resume its operations in the United States after Judge Amy Bermant Jackson rejected the SEC’s application for a temporary restraining order against the exchange’s assets.
As part of the agreement, only Binance.US employees will have access to customer funds on the U.S. based crypto exchange, excluding Binance.com.
Market Participants Await Next Steps as Binance Lawsuit Nears Conclusion
The court ruled that Binance Global officials “will not have access to private keys of all wallets, including cold and hot wallets, hardware, and software.”
Additionally, they cannot access the internal systems and controls of the U.S. subsidiary for the next 13 days, starting June 17.
With only one week remaining until the end of this period, market participants eagerly await the next steps as the lawsuit continues.
Binance has enlisted the services of a highly skilled lawyer for its defense, which has proven beneficial for the exchange. This has inspired hope for Binance Coin (BNB), which is currently trading at $242.01, representing a 3% weekly increase despite the volatile market conditions.
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