Binance and the US securities regulator disclosed a deal to ensure that only Binance.US employees could access customer funds in the short term.
Under the agreement, which still needs sign-off from the federal judge overseeing the case, Binance.US will take steps to make sure that no Binance Holdings officials have access to private keys for its various wallets, hardware wallets or root access to Binance.US’s Amazon Web Services tools, the report said.
The proposed agreement comes after the SEC sued Binance, its CEO and founder Changpeng Zhao and Binance.US’s operator last week , in a dramatic escalation of a crackdown on the industry by US regulators. The SEC also sued major US exchange Coinbase after that
The proposed deal acknowledges to an SEC motion to freeze all of Binance.US’s assets while it pursues the exchange on securities-related charges. The regulator said it was concerned that funds could be moved offshore or records destroyed if it was not granted a temporary restraining order (TRO). Binance.US’s attorneys pushed back, saying that freezing all assets would amount to the “death penalty.”
Judge Amy Berman Jackson, of the District Court for the District of Columbia, told the parties that it would be better for them to come to an agreement on a proposed stipulation than to have her craft a restraining order, which would come with a two-week time limit.
However, Other provisions in the proposed agreement will see Binance.US create new crypto wallets that the global exchange’s employees have no access to, provide additional information to the SEC and agree to an expedited discovery schedule, the filings said