Binance.US has strongly opposed the Securities and Exchange Commission’s (SEC) proposed temporary restraining order against its assets, stating that such an action would effectively end its business. In a filing on June 12, Binance.US criticized the SEC’s emergency motion for being “draconian and unduly burdensome.”
The hearing for the temporary restraining order is scheduled for June 13 in the U.S. District Court for the District of Columbia. Binance.US argued that if the restraining order were granted, it would force the closure of BAM Trading Services Inc., the entity responsible for providing cryptocurrency trading and exchange services for Binance.US. This would harm BAM’s customers, put BAM out of business, and prevent BAM from defending itself in the litigation, according to the filing.
Binance.US also criticized the SEC’s approach to the legal action, asserting that all of the SEC’s claims fail because the regulator has not identified a single security trading on BAM’s platform. The SEC has alleged that at least 68 cryptocurrencies are securities, but Binance.US argues that this is not the case. The filing highlights the fact that numerous cryptocurrency exchanges, including BAM, have operated in the United States for years without interference from the SEC, suggesting that they are not clearly covered by securities laws.
Furthermore, Binance.US stated that it has made significant efforts to cooperate with the SEC’s investigation, providing over 700,000 individual communications and bespoke data on its day-to-day operations. The SEC initiated legal action against Binance and its affiliates on June 5, accusing the crypto exchange of failing to register as a securities exchange and allowing U.S. customers to trade cryptocurrencies that it claims are securities.
The SEC also alleged that Binance CEO Changpeng Zhao (CZ) had access to Binance.US customer funds and moved $12 billion in Binance’s funds through a privately controlled entity called Merit Peak. In response, the SEC filed an emergency motion for a temporary restraining order on June 6, seeking to freeze assets held on Binance.US until the exchange could prove that the funds were not accessible to CZ or other executives at Binance.
While Binance and Binance.US have denied the SEC’s claims on social media, this filing marked their first official comment on the accusations. Binance.US argued that the SEC had been unable to identify any mishandling or misuse of BAM customer assets and stated that there is no real emergency other than the one manufactured by the SEC for its own purposes.