According to Wall Street Journal, the SEC is still looking for evidence that Binance and former CEO Changpeng Zhao had a backdoor to control user assets on Binance.US – a crypto trading platform for US residents.
In June 2023, the SEC sued Binance, Binance.US and CEO Changpeng Zhao for violating anti-money laundering laws. Now, the SEC suspects that Binance has control over the assets of Binance.US customers in a similar style to FTX.
However, Binance last week reached an agreement to settle investigations by the US Department of Justice and the Asset Futures Trading Commission (CFTC), accepting a fine of $4.3 billion. Binance CEO Changpeng Zhao also had to resign and pay a fine of $50 million, be prohibited from any involvement with Binance for 3 years and face a maximum prison sentence of 18 months.
The SEC is not in the list of regulators that reached an agreement with Binance, so this agency seems to have not yet given up its lawsuit against the exchange.
During the court hearing on Nov 27, Binance.US lawyers once again asked the judge to dismiss the SEC’s lawsuit. The lawyer claimed that the lawsuit had severely affected the exchange’s operations in the past half a year, causing it to lose half of its users, while the number of assets held on the floor decreased by 90%. The SEC has not yet provided any evidence that assets have been misused until now.
Judge Faruqui, who is presiding over the Binance and SEC case, reportedly said the guilty pleas make it less likely that Binance.US and CZ misappropriated customer assets. Faruqui has asked Binance.US and the SEC to resolve the dispute and update him by Dec 15.
The SEC in 2023 has made many moves to crack down on crypto, accusing many individuals and organizations of violating laws. This agency also repeatedly delayed Bitcoin spot ETF proposals from Wall Street financial giants, citing that the crypto industry is still rife with fraud and manipulation.