Binance CEO Changpeng Zhao (CZ) responded to a recent hearing where a judge denied the United States Securities and Exchange Commission (SEC) access to Binance.US software. CZ took to X (formerly Twitter) to address a specific issue raised by the SEC. He stated, “For the record. Binance US does not use, and have NEVER used Ceffu or Binance Custody. You can’t just make this stuff up.”
The SEC has been concerned about the role played by Ceffu in the Binance.US ecosystem. Binance.US agreed to the SEC’s June 17 consent order, which emphasized the control of customer assets by U.S.-based personnel of BAM Trading and BAM Management. Bloomberg reported that CZ, who is not U.S.-based, owned the company running Ceffu.
Ceffu, however, disputes its link to Binance.US. The company stated on its website that it provides services in select jurisdictions, excluding the United States. Despite this, a confidential document submitted to the court by Binance.US mentioned that a majority of its wallet technology is provided by Ceffu.
It is important to note that Binance launched Binance Custody in 2021, which was later rebranded as Ceffu. A Binance spokesperson referred to Ceffu as the company’s independent institutional custody partner.
In its court filing, the SEC referred to Ceffu as a “mysterious Binance-related entity” and highlighted Binance.US’s inconsistent descriptions of its relationship with Ceffu. The SEC stated that it is likely that BAM, the Binance.US holding company, still doesn’t fully understand what Ceffu is.
These developments add to the ongoing legal battle between Binance.US and the SEC. The SEC has been seeking access to Binance.US software, but the recent hearing denied them unfettered access.
It remains to be seen how this dispute will unfold and what impact it may have on Binance.US and the wider cryptocurrency industry.
Sources:
– [CZ’s Twitter post](https://twitter.com/cz_binance/status/1704116090089968082?ref_src=twsrc%5Etfw)
– [SEC court filing](https://storage.courtlistener.com/recap/gov.uscourts.dcd.256060/gov.uscourts.dcd.256060.71.0.pdf)
– [Bloomberg report](https://www.bloomberg.com/news/articles/2023-05-30/binance-may-let-some-clients-keep-trading-collateral-in-bank-accounts)
– [Ceffu’s statement](https://www.ceffu.com/support/announcements/article/our-response-to-sec-allegations)
– [Binance.US document submitted to court](https://storage.courtlistener.com/recap/gov.uscourts.dcd.256060/gov.uscourts.dcd.256060.114.12.pdf)
– [Binance spokesperson’s statement](https://cointelegraph.com/news/binance-custody-partner-clarifies-singapore-licensing-plans)
– [SEC court filing](https://storage.courtlistener.com/recap/gov.uscourts.dcd.256060/gov.uscourts.dcd.256060.113.0.pdf)
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About the author - J-S Tremblay
I've been involved in the cryptocurrency world since 2016 and trading since 2019. I started Moon and Lambo in 2021. I'm passionate about crypto and love to share my knowledge. I hate bankers and I hope that cryptocurrency will change the financial world for the better. View full profile...
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