U.S. District Court Judge Amy Berman Jackson denied the U.S. Securities and Exchange Commission's (SEC) request for an emergency temporary restraining order (TRO) against Binance, the world's largest crypto exchange, which would've allowed the SEC to freeze the company's U.S. assets, according to CoinTelegraph.
“Binance put out a restrained public response to the TRO ruling out of respect for the judge, but they are celebrating what is a crushing defeat for the SEC. Rarely are government agencies denied a TRO by the courts. Judge Berman holding the SEC’s feet to the fire on not having the evidence to suggest funds have been misused sends a clear message to regulators across the globe that the SEC doesn’t have the goods to substantiate their most damaging allegations,” an industry insider said, FOX Business reporter Eleanor Terrett tweeted.
According to the agreement, only U.S.-based Binance employees will have the ability to access client funds until the litigation is resolved. U.S.-based customers will also have the ability to withdraw funds during this period.
During the hearing, Berman Jackson said that Binance's "memorandum raises a lot of legitimate questions and concerns about the merits and about whether litigation is the best method to get at this highly disputed issue that affects billions of dollars already invested on multiple platforms in the U.S. and elsewhere."
Berman Jackson added that the provided memo states that the SEC has not presented any evidence to support its claim that Binance customers' funds are being misused.
"You all repeat in the memo that there's no evidence, absolutely no evidence of any dissipation of assets whatsoever," she said. "And the government at this point has said they haven't seen the evidence of offshore transfers from BAM Trading itself. But we do have considerable evidence of offshore transfers and we do have the problem of the individual defendants' ownership of the entities that own BAM Management, which is the parent of BAM Trading. So there's a lot of layers going on here and a lot of onion that needs to be peeled to figure out who is doing what."
Both Binance and its CEO published statements on Twitter following the judge's decision on Saturday.
"Although we maintain that the SEC's request for emergency relief was entirely unwarranted, we are pleased that the disagreement over this request was resolved on mutually acceptable terms," Binance founder and CEO Changpeng (CZ) Zhao wrote. "User funds have been and always will be safe and secure on all Binance-affiliated platforms."
"We were able to reach a court-ordered agreement with the SEC that allows us to continue our ordinary course business," Binance.US wrote. "There has never been any evidence presented by the SEC concerning misuse of customer assets. In fact, the SEC lawyers conceded in court earlier this week, when asked by the judge, that they had no evidence suggesting that any such thing had occurred. We look forward to continuing to defend ourselves in court."