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by Mike Caswell

The U.S. Securities and Exchange Commission has won an interim order for U.S. assets related to Binance Holdings Ltd., operator of a cryptocurrency exchange that has handled as much as $9.58-trillion in trading. (All figures are in U.S. dollars.) The SEC claims that Binance and its Canadian founder, Changpeng Zhao, have been operating in the U.S. as an unregistered exchange. In particular, the SEC said that the operation provided no oversight or controls over billions of dollars in assets.

As part of the case, the SEC had been seeking an emergency freeze order. The regulator said that Binance's U.S. entities held assets belonging to U.S. investors worth $2.2-billion. Binance opposed any freeze, saying that it would effectively end the company's business. Such a freeze would harm customers and keep the company from paying employees, it said.

The matter landed before a U.S. federal judge, who signed an order on Saturday, June 17, that falls short of an outright freeze, but imposes several restrictions on Binance's U.S. operations. Among other things, Binance must move the assets of U.S. customers to the United States and keep those assets in the country for the duration of the litigation. The order specifically prohibits the transfer of any money to Binance Holdings or to Mr. Zhao. The order further states that Binance's U.S. entities can only spend money in the normal course of business, with the SEC to have oversight over those expenditures. Customers are permitted to withdraw money from their accounts.

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