Recently, a US court has given Binance US the green light to invest a portion of its customer fiat funds, which are currently being held at BitGo, in US Treasury Bills. The exchange had requested permission to invest around $40 million in increments of $10 million over a span of four weeks. The investments will be channeled through a trading account on TreasuryDirect, with the US Treasury bills maturing on a rolling four-week basis.
On July 19, Judge Amy Berman Jackson not only approved the exchange’s request for investments but also laid out certain conditions. One of the conditions stated that Binance US must ensure that it maintains sufficient funds on its platform to meet all anticipated customer withdrawal requests. Furthermore, the exchange is required to update its terms of use to notify customers about the investment decisions.
Currently, Binance US is entangled in a legal dispute with the US Securities and Exchange Commission (SEC). Despite this ongoing battle, the exchange has been granted permission to engage third-party investment advisors to manage its corporate assets. Additionally, the custodied assets will be transferred to a non-affiliated custodian in the United States, and the private keys for the wallets will be monitored by employees or the custodian in the US.
In a separate incident, the international Binance exchange collaborated with the US Federal Bureau of Investigations (FBI) San Diego to investigate a pig butchering scam. This scam involved fraudulent schemes where victims were deceived into investing in fake crypto schemes. The scammers used manipulative tactics to gain victims’ trust online and subsequently stole their assets.
According to the US Department of Justice, pig-butchering scams have become increasingly common, with over $2 billion being stolen through such schemes in 2022 alone. Victims are tricked into making multiple payments, only to realize later that they have been duped. This not only results in significant financial losses but also inflicts emotional harm on the victims.
The court’s decision to allow Binance US to invest customer funds in US Treasury Bills comes with certain responsibilities and regulations. Despite the legal challenges faced by the exchange, it is crucial for them to uphold the trust and confidence of their customers while navigating the complex landscape of cryptocurrency investments and scams.
Leave a Reply