The lawsuit of the U.S. SEC against Binance has been strengthened by the $4.3 billion legal settlement between the firm, the Department of Justice, and other U.S. entities. SEC, which has no connection with the settlement but aims to move ahead with legal proceedings against Binance, the biggest crypto exchange in the world.
Continued Legal Battle Against Binance
On December 8, the SEC asked a federal court in Washington DC to look at admits that were made as part of the legal agreement signed by Binance and its former CEO, Changpeng Zhao, on November 21. The SEC’s lawsuit filed in June against Binance and Zhao accuses them of fraudulently using customer funds, deceiving investors and regulatory bodies, and breach of securities laws. However, the SEC has counter-argued that Binance’s defence is not legally sound but rather a twist of various legislations.
SEC contends that Binance’s defense may jeopardize important precedents in the American securities law. The regulator argues that Binance’s approach creates a rigid model foreign to the current legal context.
The court also requires Changpeng Zhao to remain in the US
After Zhao admitted the charges against him, US District Judge Richard Jones issued a ruling on December 7th, 2023, ordering that Zhao should stay in the US until his sentencing. Because of the severity of the crime committed by Zhao in the USA, he wouldn’t be allowed to go back to his residence UAE as per Judge Jones. The plea deal requires that Zhao, who resigned as Binance’s CEO, serve a maximum of 10 years in a jail and is likely to get 18 months of imprisonment. As part of the settlement, he also consented to pay a $50 million penalty.