Binance Responds to SEC Charges, Vows to Defend Platform Vigorously
The Securities and Exchange Commission (SEC) has filed 13 charges against Binance Holdings Ltd., its U.S.-based affiliate BAM Trading Services Inc., and founder Changpeng Zhao for violations of securities law.
The charges include operating unregistered exchanges, broker-dealers, and clearing agencies; misrepresenting trading controls, oversight on the Binance.US platform; and the unregistered offer and sale of securities.
The SEC alleges that Binance and Zhao secretly allowed high-value U.S. customers to trade on Binance.com and controlled the Binance.US platform’s operations behind the scenes.
They are also accused of commingling customer assets and diverting them to an entity owned by Zhao called Sigma Chain.
SEC Chair Gary Gensler stated that the charges allege an “extensive web of deception, conflicts of interest, lack of disclosure, and calculated evasion of the law”.
4.— CZ 🔶 Binance (@cz_binance) June 5, 2023
Our team is all standing by, ensuring systems are stable, including withdrawals, and deposits.
We will issue a response once we see the complaint. Haven't seen it yet. Media gets the info before we do.
Following the shocking news, Binance issued an official statement, making it clear that they’re disappointed in the SEC’s decision.
According to the press release, the company has been cooperating with the SEC’s investigations and engaging in good-faith discussions to reach a negotiated settlement.
However, the SEC has chosen to abandon the process and litigate unilaterally.
They also assured that user assets on the Binance.US platform have never been at risk and that all assets on Binance and its affiliate platforms are safe and secure.
Binance takes the SEC’s allegations seriously but believes they should not be the subject of an enforcement action, especially on an emergency basis.
The company intends to defend its platform vigorously, stating that the SEC’s refusal to engage productively is another example of the SEC’s misguided approach to providing clarity and guidance to the digital asset industry.
The world’s largest cryptocurrency exchange is now prepared to fight the SEC’s overreach to the full extent of the law and will work alongside industry partners to defend the technology from misguided lawsuits.