Court Approves SEC’s Request to Unseal Crucial Documents in Binance Legal Battle

Court Approves SEC's Request to Unseal Crucial Documents in Binance Legal Battle


SEC’s Motion to Unseal Documents in Binance United States Lawsuit Approved by District Judge

A district judge has approved the Securities and Exchange Commission’s (SEC) motion to unseal documents in its lawsuit against Binance United States. The information was previously filed under seal, but the SEC moved to make plenty of documents public, including exhibits for a declaration made by SEC Trial Counsel Jennifer Farer. The approval comes after the SEC accused Binance United States of a “lack of transparency” and the company saw executive departures.

SEC Lawsuit Against Binance US

The SEC sued Binance United States in June, alleging that the exchange violated securities laws across 13 charges, such as operating as an unregistered securities exchange. In its complaint, the SEC likewise alleged that billions of dollars of customer funds were commingled in an account controlled by Binance CEO Changpeng Zhao. A deal was struck between Binance United States and the SEC to prevent a freeze of assets in exchange for greater transparency and oversight.

Regulator’s Concerns

In its court filings, the SEC accused Binance US’s holding company, BAM, of only producing 220 documents related to the investigation, which fell short of ensuring the safety of customer assets. The SEC likewise claimed that Ceffu, a wallet custody software service owned by Binance Holdings Ltd, appeared to have control over BAM’s cryptocurrency assets. The regulator raised concerns about BAM’s external auditor and argued that it did not learn about the auditor’s concerns until July 2023.

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Unsealing of Documents

United States Magistrate Judge Zia M. Faruqui instructed the court’s clerk to unseal over a dozen exhibits in full while redacting information from other exhibits partially or completely. The SEC did not oppose the sealing or partial sealing of some documents identified as confidential by Binance United States, and parties involved have a week to provide explanations for why certain documents deserve the designation.

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Hot Take: SEC’s Motion to Unseal Documents in Binance United States Lawsuit Approved

The district judge’s approval of the SEC’s motion to unseal documents in its lawsuit against Binance United States is a whole lot of development in the ongoing legal battle between the two parties. The move allows for greater transparency and access to information related to the case, shedding light on the states made by the SEC against Binance United States. As the lawsuit progresses, it remains to be seen how this unsealing of documents will impact the outcome and whether it will provide further evidence to facilitate the SEC’s states. Both Binance United States and its parent company, Binance, are expected to closely monitor these developments as they defend themselves against the allegations.

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