The U.S. Securities and Exchange Commission (SEC) filed an emergency action application seeking a temporary restraining order freezing assets, directing defendants to repatriate assets held for the benefit of customers of the Binance.US crypto trading platform, and seeking other emergency relief against Binance Holdings Limited, BAM Trading Services Inc., BAM Management US Holdings, Inc., and their founder, Changpeng Zhao (CZ).
On Monday, the SEC filed a lawsuit against the Binance entities and their founders with 13 Charges. The regulator accuses Binance (and also its competitor Coinbase) of not having the authorization to operate a securities exchange. However, This would be necessary because the SEC qualifies some tokens traded on crypto exchanges as securities.
The regulator says that it wants to ensure that Binance.US customers’ assets are protected and remain in the United States through the resolution of the SEC’s pending litigation.
As part of the SEC’s emergency motion, the SEC seeks (1) an order to show cause why a preliminary injunction should not be granted as to the defendants; (2) an order freezing the assets of BAM Management; (3) an order directing the defendants to repatriate assets held for the benefit of BAM Trading‘s or BAM Management’s (together “BAM”) customers; (4) an order for other relief concerning the custody and control of BAM customers’ assets; (5) an order prohibiting the destruction of records by the defendants; (6) an order requiring sworn accountings of certain assets from the defendants; (7) an order authorizing expedited discovery from the defendants; and (8) an order granting alternate means of service.
