December 5, 2023


In a recent court hearing overseen by Judge Amy Berman Jackson of the D.C. District Court, the U.S. Securities and Exchange Commission’s (SEC) motion for a temporary restraining order freezing the assets of Binance and Binance.US, two cryptocurrency exchanges, was declined. The judge’s decision allows the U.S. arm of the company to continue its operations while engaging in negotiations with the regulatory body to establish appropriate restrictions. This article examines the court proceedings and highlights the key points of contention between the SEC and the crypto exchanges.

In a packed Washington courtroom, Judge Amy Berman Jackson questioned SEC attorneys extensively regarding their motion to freeze all assets of Binance.US. The SEC’s primary concern was whether individuals associated with Binance’s global platform, including Changpeng “CZ” Zhao, had access to the private keys controlling the funds. The judge expressed frustration at the lack of clarity regarding whether any customer funds from Binance.US had left the United States.

Judge Jackson indicated her inclination to impose certain restrictions on Binance’s access to Binance.US assets but stopped short of granting a full restraining order. She directed the parties to reconcile their proposed restrictions and requested the SEC to contrast its requirements with those put forth by the companies. Jennifer Farer, an SEC lawyer, stated the SEC’s willingness to allow Binance.US to continue operating, while representatives of Binance.US sought authorization for normal operating expenses, arguing against a complete asset freeze.

During the proceedings, Farer pointed out that Binance.US had changed its account of how crypto assets and funds were held, complicating the matter further. Binance.US had initially claimed to have an operational agreement with Binance, but later said the agreement was not in effect and subsequently claimed it had been suspended. The shifting explanations added to the SEC’s concerns.

The possibility of Binance.US ceasing its operations in the U.S. also emerged during the hearing, prompting the SEC’s request for an emergency order. However, Judge Jackson observed that the parties were not far apart and emphasized the importance of finding an agreement that would allow time for a thorough examination of the case’s details.

The SEC’s lawsuit against Binance, Binance.US, and Changpeng “CZ” Zhao alleges that they operated as unregistered securities exchanges, brokerages, and clearing agencies. The regulator further claimed that there was significant commingling of funds, enabling Zhao access to Binance.US customer assets.

The judge also delved into the fundamental question of whether a crypto asset is considered a security or a commodity. While the SEC provided examples of cryptocurrencies it deemed securities, it reserved the right to assess the remaining tokens on the exchanges at a later stage. The distinction between securities and commodities in the cryptocurrency industry has long been a subject of debate.


Judge Amy Berman Jackson declined to issue a temporary restraining order freezing the assets of Binance.US in the SEC’s case against the crypto exchanges. The judge emphasized the need for the parties to reach an agreement on restrictions while requesting transparency regarding the movement of customer funds. The court proceedings shed light on the ongoing debate surrounding the classification of crypto assets as securities or commodities.


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