In a recent legal clash with the US Securities and Exchange Commission (SEC), Binance.US has implored a federal judge to dismiss the regulator’s request to freeze assets on the cryptocurrency exchange. Binance’s US division maintains that such an action would not only cripple their business but also adversely affect their customers, as per Bloomberg.
Binance.US attorneys have expressed that if the exchange were unable to remunerate employees, vendors, suppliers, and professionals or maintain their trading platform, operations would quickly cease. Moreover, they argue that if all corporate assets were frozen, banking partners would likely discontinue honoring requests to transfer funds for any purpose, including customer redemptions.
This development comes after the SEC’s lawsuit against Binance entities and founder Changpeng Zhao, in which they accuse the exchange of displaying a “blatant disregard” for US securities laws, as well as “years of violative conduct” that endangers customer funds. Despite the SEC’s allegations, Binance has vehemently disputed these claims.
In defense of their action to prevent the freezing of assets, Binance.US attorneys have stated in their court filing that there is no necessity for the “draconian relief” sought by the SEC, asserting that US customer assets are safe. The SEC had previously filed an emergency action application for a temporary restraining order to halt Binance.US’s assets in a bid to protect customer funds, which includes the repatriation of client investments held overseas.
In an interesting turn of events, Republican lawmaker Warren Davidson unveiled the “SEC Stabilization Act” in the House of Representatives on Monday. Among the bill’s primary provisions is the dismissal of current SEC Chair Gary Gensler. The legislation also aims to redistribute power between the SEC chair and commissioner. Though cryptocurrencies were not specifically mentioned in their statements, both Republican lawmakers, Warren Davidson and Tom Emmer, are known to be positive toward the crypto industry.
The ongoing legal battle between Binance.US and the SEC raises questions about the role of regulations in the cryptocurrency space, the responsibility of exchanges, and their commitment to protecting investors. While Binance.US contends that it operates with its customers’ interests in mind, regulatory authorities like the SEC are becoming increasingly vigilant in their efforts to ensure compliance with securities laws. As the crypto landscape continues to evolve, striking the right balance between the protection of investors and fostering innovation remains a crucial challenge.
Source: Coingape
