- The SEC has asked a US court for an order to temporarily freeze assets linked to Binance.US as it prosecutes its case against the company.
- The Commission also seeks an expedited discovery period and substituted service instead of the traditional physical service.
- The crypto community and industry executives have stood in solidarity with Binance, heavily criticizing the SEC.
The digital asset market is under intense regulatory fire from the Securities and Exchange Commission (SEC), with Binance and Coinbase at the fore. Experts say this might only be the surface.
Barely a day after the SEC filed a lawsuit against Binance, the Commission is now looking to seize its assets to protect users. According to the filing made at the DC District Court, the SEC has asked the judge to freeze assets belonging to Binance.US through two companies.
The two impacted companies, BAM Management US Holdings and BAM Trading Services, act as the holding and operational firms for Binance US. The motion also requests that funds held by the two companies be returned to their customers, whether in fiat or digital assets.
If the motion is granted, funds overseas will be repatriated to the United States, and the companies, along with CEO Changpeng Zhao (CZ), would show cause against a pending preliminary injunction. In addition, the motion mandates Binance US to preserve all records without destroying, mutating, or altering anything.
The Commission wants the whole process expedited “to ensure the safety of customer assets and prevent the dissipation of available assets for any judgment” and will institute substituted service instead of the traditional physical method.
Community roots for Binance
Binance has received much support from the digital asset community and industry executives following its regulatory battle with the SEC. The company, in its response, stated that it would “vigorously” defend its reputation, debunking all allegations.
The move to seize Binance.US assets has faced initial criticisms around digital assets spaces on social media. Shark Tank’s Kevin O’Leary expressed that the move will starve Binance of oxygen, adding that the entire sector may need to find another haven.
In reaction to Gary Gensler’s comments on the similarities between Binance US and FTX, crypto enthusiasts have fired back, asking Gensler why FTX was not sued and Binance being unfairly targeted. Ripple’s CEO Brad Garlinghouse noted that the recent attack of Binance was a ploy to “distract users from how it handled FTX.”
