June 7, 2023

SEC Files Motion for an Emergency Restraining Order to Freeze Assets of Crypto Trading Platform

The SEC requested a temporary restraining order ("TRO") to freeze the assets of the crypto asset trading platform Binance Holdings Limited, following recent charges for failing to register with the agency.

As previously covered, the SEC charged that the Binance platform (the "Platform") (i) unlawfully offered exchange, broker-dealer and clearing agency services without registering with the SEC, (ii) engaged in unregistered offers and sales of crypto asset securities while depriving investors of material information regarding risks and trends affecting their investments and (iii) made misrepresentations to investors while attracting "billions of dollars" in investor trading volume.

The SEC argued in its brief supporting the TRO, that the order was necessary to assure the safety of investors' assets and preserve the availability of funds. Among other things, the SEC motion included a request for the repatriation of assets held for the benefit of customers, relief concerning the custody of customers' assets, and a prohibition against the destruction of records.

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