Binance CEO Changpeng Zhao (CZ) has denied that its U.S. subsidiary, Binance.US, ever used Ceffu or Binance Custody for custodial companies.
Zhao made this assertion in response to the Securities and Alternate Fee’s (SEC) request to analyze potential fund motion violations by the embattled subsidiary of his trade. The monetary regulator is investigating Binance.US‘s use of Ceffu, which could be serving the agency and, due to this fact, getting used to switch U.S. buyer funds overseas regardless of prior agreements.
In the meantime, this denial contrasts with earlier statements made by Binance.US in court docket filings, the place they acknowledged the usage of custody software program initially offered by Binance Holdings Ltd, which later rebranded as Binance Custody. These filings and correspondences often talked about Ceffu.
Contradictions
Zhao’s current denials have sparked considerations and raised questions concerning the veracity of earlier statements, prompting requires additional clarification.
Fund Supervisor Adam Cochran noted the discrepancy on X (previously Twitter), saying that if Zhao is prepared to lie about what’s in court docket paperwork, he may lie about security or belongings.
The continuing controversy surrounding Binance provides additional challenges to the trade’s efforts in addressing allegations of unregistered trade operations and itemizing unregistered securities in the USA. The emergence of Ceffu now turns into one other level of rivalry between the regulatory authorities and the crypto platform.
On its half, BAM, which is the corporate behind Binance.US, claims that Binance is simply a third-party vendor that gives pockets companies. Nevertheless, the SEC argues that the identical particular person owns Binance and BAM.
The SEC not too long ago pushed for Binance.US and associated corporations to supply discovery info in numerous areas, together with the character of its crypto pockets custody and its relationship with the Ceffu pockets, communications relating to its management over buyer belongings, and different monetary paperwork.
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