Binance, the popular cryptocurrency exchange, is facing ongoing legal challenges in the United States. In June 2023, the United States Securities and Exchange Commission (SEC) filed a lawsuit against Binance, resulting in significant financial losses and a reduction in staff. Now, the SEC is accusing the company of being uncooperative in providing information about the custody of customer assets. The regulator has requested court intervention to expedite the discovery process.
At the center of the SEC’s investigation is the question of whether employees of Binance’s non-U.S. arm had access to Binance.US customer assets. The SEC claims that Binance.US has failed to demonstrate that it did not have access to private keys or other means of accessing customer assets. Binance.US has pushed back against these allegations, stating that it has complied with the SEC’s requests for information and has asked the court to end the expedited discovery process.
In another legal development, a U.S. appeals court has overturned a ruling that dismissed a class-action lawsuit against Binance. The lawsuit, filed by investor Chase Williams in April 2020, alleges that Binance engaged in the sale of securities without proper registration. The district court initially dismissed the lawsuit, citing the statute of limitations. However, the appeals court has sided with the plaintiffs, stating that Binance is subject to domestic securities laws and that the initial filing was timely.
Meanwhile, the extradition case of Do Kwon, co-founder of Terraform Labs, has taken another turn. A court in Montenegro has overruled a previous decision to extradite Kwon to the United States. The Appellate Court of Montenegro cited significant violations of local criminal procedure laws in its decision to annul the extradition order. Kwon’s extradition has been requested by both the U.S. and South Korea, leading to a disagreement over where he should be sent.
In a positive development for the crypto industry, the Virginia Senate has passed a bill that establishes a workgroup dedicated to studying and promoting the cryptocurrency ecosystem. The workgroup will consist of members from the Senate, the House of Delegates, the blockchain industry, and the local government. They have been given a deadline of November 1, 2024, to complete their studies and provide recommendations.
On the privacy front, the Spanish Agency for the Protection of Data (AEPD) has ordered Worldcoin to halt its data collection and processing activities in Spain. The AEPD is investigating complaints that Worldcoin has collected data without proper consent, including data from minors. This comes after a similar investigation by Hong Kong’s Office of the Privacy Commissioner for Personal Data. Worldcoin has faced controversy due to its use of biometric scanning devices known as “orbs” for user verification.
Overall, Binance’s legal challenges continue to mount, Do Kwon’s extradition case remains unresolved, Virginia is taking steps to foster the crypto industry, and Worldcoin is facing privacy concerns in Spain.