The SEC and Binance US will seek to reach an agreement that avoids the complete freeze of assets of the exchange
District Judge Amy Berman Jackson has ordered the two entities to settle.
#Binance US and the United States Securities and Exchange Commission ( #SEC ) have agreed to work on an agreement that allows the exchange to avoid freezing all of its assets.
On June 14, Bloomberg reported that US District Judge Amy Berman Jackson referred the two organizations to a magistrate judge to work out a compromise agreement to protect client funds without having to shut down the exchange.
“Shutting it down completely would have significant consequences not only for the company, but for digital asset markets more broadly,” Jackson said at a June 13 hearing.
Judge Jackson indicated that she would not make a final decision on the SEC's request for a temporary restraining order until the two parties had resolved the matter with the magistrate.
Furthermore, he noted that the SEC and Binance US did not seem “so distant” when it came to reaching an agreement on the matter. Before Judge Jackson made her decision at the hearing, former SEC attorney John Read Stark told his 20,000 Twitter followers that there was "a lot of conflict between what each side" wanted to get out of the hearing.
"That doesn't mean the judge can't order to settle and find a middle ground," Stark explained.
The SEC filed an emergency motion for a temporary restraining order on Binance.US on June 6, after accusing Binance CEO Changpeng “CZ” Zhao of being able to access funds from Binance US clients.
The regulator alleged that Zhao moved $12 billion of funds from Binance through an entity he controlled called Merit Peak.
In a joint memorandum filed on June 12 before the restraining order hearing, both Binance.US and Zhao denied claims that the funds had been mishandled.
They accused the SEC of being “unable to identify a single case” in which Binance US client funds have been misused.
