Binance Responds Strongly To SEC Charges With Over 20 Motions
- In response to the SEC complaint, Binance filed multiple motions in the US District Court for the District of Columbia.
- The SEC filed 13 accusations against Binance, Binance.US, and CZ last week, alleging he violated US securities laws.
- According to Binance’s attorneys, the company has been in contact with the SEC since 2021.
On Monday, Binance filed multiple papers in the US District Court for the District of Columbia in response to the action launched by the US Securities and Exchange Commission against the biggest cryptocurrency exchange by volume.
The SEC said in the exchange’s complaint last week that the giant exchange Binance, its CEO Changpeng ‘CZ’ Zhao, and Binance.US violated securities laws and enriched themselves by billions of dollars while putting investors’ funds in danger. The SEC further claims that Zhao and his company participated in a “web of deception” that included conflicts of interest, failure to disclose, and intentional evasion of the law.
Daniel W. Nelson, the legal representative of Binance, stated in a submission co-signed by various attorneys of the exchange:
“The SEC’s request for a temporary restraining order should be denied for several reasons, but the most important is this: there is no risk to BAM’s customer assets. Indeed, there is no ‘emergency’ here at all, other than the one manufactured by the SEC for its own purposes, when the alleged securities law violations, according to the SEC, have been going on publicly and openly for years.”
BAM Trading Services is the company behind Binance.US. According to the SEC, it is mostly held by BAM Management US Holdings, which is majority controlled by CZ.
Binance’s attorneys questioned the timing of the SEC’s accusations, which coincided with a lawsuit against Coinbase, the biggest cryptocurrency in the United States, in more than 20 motions and declarations filed with the court.
According to the company’s legal team, the SEC ignored a basic security concern: whether this conduct was lawfully allowed by the commission since Chairman Gary Gensler had personal meetings with Zhao and the exchange throughout the period in question.
Binance’s lawyers’ state in the filings that the company has been in contact with the SEC since 2021. Even still, it wasn’t until February 2023 that they discovered they were probable targets of an inquiry into the Binance.US exchange.
On June 5 and 6, the SEC launched substantial litigation against Binance, the world’s biggest digital currency exchange, and Coinbase, the largest US-based exchange. While Gary Gensler has not been hesitant to issue enforcement actions against crypto companies, particularly following the collapse of FTX, these suits represent a significant new step in the SEC’s battle against crypto as well as its continued abdication of regulatory responsibility over the crypto landscape.
“As alleged, Zhao and Binance misled investors about their risk controls and corrupted trading volumes while actively concealing who was operating the platform, the manipulative trading of its affiliated market maker, and even where and with whom investor funds and crypto assets were custodied. They attempted to evade U.S. securities laws by announcing sham controls that they disregarded behind the scenes so that they could keep high-value U.S. customers on their platforms. The public should beware of investing any of their hard-earned assets with or on these unlawful platforms,” Gensler said in a statement.
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