Recently, a US court has granted Binance US permission to invest a specific amount of customer fiat funds, currently held at BitGo, in US Treasury Bills. The exchange requested court approval to invest around $40 million in increments of $10 million over four weeks. These investments will be made through a trading account on TreasuryDirect in US Treasury bills that will mature on a rolling four-week basis.
Judge Amy Berman Jackson approved the exchange to invest its customer fiat funds with the condition that it must maintain enough funds on its platform to meet all expected customer withdrawal requests. The judge also stated that Binance US must update its terms of use to notify customers accordingly. Moreover, the judge granted the exchange additional rights, including authorization to engage third-party investment advisors to manage corporate assets and transfer custodied assets to a non-affiliated third-party custodian within the United States. The firm must ensure that new private and administrative keys for wallets are maintained and directed solely by its employees in the US or by the third-party custodian in the US. The exchange must also conduct reasonable diligence to ensure that the advisors managing its assets do not qualify as Binance Entities.
Binance US, a subsidiary of the global exchange Binance, is currently facing a legal dispute with the US Securities and Exchange Commission (SEC). In a separate incident, the international Binance exchange recently collaborated with the US Federal Bureau of Investigations (FBI) in San Diego to investigate a pig butchering scam that led to the recovery of $2.5 million in USDT.
Understanding Pig Butchering Scams
Pig butchering schemes are fraudulent activities where scammers use manipulative tactics to gain victims’ trust online. Once trust is established, these scammers entice unsuspecting victims to invest in a fake crypto scheme. Victims are often persuaded to make additional payments before realizing the fraud. The “butchering” occurs when the scammer steals the victim’s assets, causing severe financial and emotional harm. According to the US Department of Justice, these scams have become increasingly common, with over $2 billion stolen through such schemes in 2022.
The legal landscape surrounding Binance US is complex and evolving, with court approvals and ongoing battles with regulatory authorities. It is crucial for investors and customers to stay informed about these developments to protect their interests and assets in the cryptocurrency market.
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