Binance.US (BAM) has responded to the Securities and Exchange Commission (SEC), referring to the SEC’s motion for depositions of the exchange’s executives and further discovery as “unduly burdensome” and characterized it as “freewheeling.” The exchange argues that it has not been presented with any evidence to substantiate the SEC’s claims of wrongful diversion of customer funds.
Despite the discovery that Binance.US has already provided during the expedited discovery period, the exchange contends that the SEC has failed to produce any evidence to support its allegations that imply customer assets were misappropriated. Binance.US asserts that all the available evidence, including documents, declarations, and sworn deposition testimony, supports its position that it has proper custody and control of its digital assets.
In June, the SEC accused Binance CEO Changpeng ‘CZ’ Zhao and Guangying ‘Helina’ Chen of routing billions of dollars in customer funds through intermediary companies, citing testimony from an SEC accountant. Both Binance and CZ publicly refuted these allegations. Binance.US, in its filing, notes that CZ has confirmed that he does not have custody or control over the private keys for customer assets on the exchange.
The SEC had sought an asset freeze on Binance.US, but this request was denied by a U.S. judge, who instead ordered the parties to engage in negotiations regarding ongoing operations.
In its response, Binance.US questions the scope of the SEC’s requests, including documents related to the exchange’s custody software and wallet solutions. The exchange asserts that the SEC has not provided a clear rationale for deposing BAM’s CEO and CFO within the framework of the Consent Order. BAM further contends that the burden imposed by these depositions outweighs their potential benefit and that the discovery sought is disproportionate to the needs outlined in the Consent Order.
