Binance, Binance.US, and Changpeng “CZ” Zhao, the CEO of Binance, have accused the U.S. Securities and Exchange Commission (SEC) of issuing misleading statements regarding an ongoing securities lawsuit.
Lawyers representing the crypto exchanges filed a motion on June 21 in the U.S. District Court for the District of Columbia, claiming that the SEC’s statements in a press release on June 17 were deceptive. They have requested the financial regulator to adhere to the appropriate rules of conduct.
The motion refers to a statement made by SEC Enforcement Director Gurbir Grewal, where he alleged that CZ and Binance had the ability to commingle or divert customer assets.
However, the legal teams argued that a court transcript from a June 13 hearing contradicts these claims. The filing emphasized that there is no evidence of dissipation, commingling, or misuse of customer assets by Binance.US.
Furthermore, it accused the SEC’s press release of causing confusion in the market, potentially harming Binance.US customers and providing misleading descriptions of the evidence to the jury pool.
If approved by a federal judge, the order resulting from this motion could prevent the SEC from making certain public statements related to the Binance lawsuit that could significantly impact the court proceedings.
The Binance legal team presented a portion of the court transcript that shows the SEC’s acknowledgment that there is no evidence of Binance.US assets being sent offshore.
The court filing is part of an ongoing lawsuit filed by the SEC on June 5 against Binance, Binance.US, and CZ.
The lawsuit alleges that the exchanges conducted unregistered securities offerings, and Binance failed to register as an exchange or broker-dealer clearing agency. SEC Chair Gary Gensler accused CZ and Binance of misleading investors about their risk controls and sought disgorgement and other penalties.
Initially, the SEC requested a court order to freeze all assets of Binance.US. However, a compromise was reached, allowing only the exchange’s employees access to client funds during the litigation process.
Amid these legal proceedings in the United States, Binance announced the launch of a regulated cryptocurrency platform in Kazakhstan.
As the case progresses, the motion filed by Binance, Binance.US, and CZ aims to challenge the SEC’s statements and ensure compliance with appropriate rules and standards of professional conduct.
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