Binance disputes with the U.S. Securities and Exchange Commission (SEC) as it files for court-ordered protection against what it alleges to be excessive and unreasonably broad discovery demands.
The exchange contends that the SEC’s interpretation of a June court order has gone beyond its intended scope, and Binance seeks safeguards to ensure a fair and focused examination of its practices.
Binance’s complaint, lodged on August 14, accuses the SEC of abusing the discovery provision of a Consent Order that authorized “limited expedited discovery” on specific aspects concerning the custody, security, and availability of customer assets.
The exchange argues that the SEC’s demands have strayed from these parameters, encompassing documents and information that are only tangentially related to customer assets.
While Binance maintains that it has acted in good faith and complied with the SEC’s requests, it asserts that the regulator’s interpretation of the Consent Order is overly expansive.
The exchange points out that it has offered depositions from senior employees responsible for customer funds, yet this compromise has not gained traction with the SEC. Binance contends that the SEC’s approach amounts to a “fishing expedition” rather than a focused discovery.
To address these concerns, Binance is seeking a protective order that would narrow the scope of the SEC’s demands.
The order proposes limiting depositions to key exchange employees, excluding high-ranking officials, and restricting questions to the framework of the June court order.
The objective is to prevent the SEC from pursuing inquiries that are unrelated to the security and availability of customer assets.
This latest development follows the SEC’s lawsuit against Binance and its U.S. branch, Binance.US, in June. The lawsuit alleges that Binance operated an unregistered securities exchange and conducted associated sales without proper registration.
Additionally, Binance faces challenges from the Commodity Futures Trading Commission (CFTC), which claims that Binance knowingly violated CFTC rules and actively sought to maintain operations while circumventing compliance.
Judith Faith has been writing about cryptocurrencies and blockchain technology for over five years. She is well versed in the industry and has an extensive network of industry contacts. She is also a frequent contributor to various cryptocurrency publications. With her vast knowledge and experience, she is able to provide insightful and valuable content to her readers. Judith is also an active investor in the cryptocurrency space and has a vested interest in the success of the industry.
Related posts
A US Senator opposes Biden’s strict crypto rules, demands clearer regulations
Blockchain Visionaries Assemble: Tido Capital’s Trailblazing Event Fuels Web3 Revolution
