The legal disputes between Binance and U.S. regulators appear endless. Despite paying a $4.3 billion settlement to the U.S. Department of Justice (DOJ), Financial Crimes Enforcement Network (FinCEN), Office of Foreign Assets Control (OFAC), Internal Revenue Service (IRS), and Commodity Futures Trading Commission (CFTC), the Securities and Exchange Commission (SEC) case continues.
Court Order Breakdown: Key Authorizations
Yesterday's court order from the U.S. District Court for the District of Columbia allows Binance.US operator BAM Trading Services Inc. (BAM) to maintain operations during ongoing litigation. The three key provisions are:
- Corporate Asset Investment
BAM may delegate its funds to third-party investment advisors, provided they're unaffiliated with Binance. Investments must exclude Binance-linked entities. Customer Fiat Funds Investment
BAM may invest portions of client fiat holdings (currently held with BitGo) exclusively in:- 4-week U.S. Treasury Bills (28-day maturity)
- Funds must remain liquid for customer withdrawals
- Binance must have zero involvement
Crypto Asset Custody
BAM may transfer assets to U.S.-based third-party custodians under these conditions:- Private keys controlled by BAM employees or custodians
- All transfers require BAM/third-party approval
- Binance entities retain no control
Background: Legal Entities Involved
| Entity | Description |
|---|---|
| Binance Holdings Ltd. | Cayman Islands-registered parent company |
| BAM Trading Services Inc. | Delaware-registered Binance.US operator |
| BAM Management US Holdings Inc. | Parent company controlling BAM Trading |
👉 How Treasury Investments Impact Crypto Exchanges
SEC vs. Binance: Case Timeline
- 2022: SEC initiates investigations
June 2023: SEC files lawsuit alleging:
- Unregistered securities exchange operations
- Violations of anti-money laundering laws
- Classification of BNB as security
- July 2023: Binance denies allegations
- September 2023: Preliminary court rulings
- 2024 (Current): Ongoing litigation
Why This Matters for Traders
The authorization:
- Does NOT apply to cryptocurrency assets
- Affects only select fiat holdings
- Prioritizes fund safety during legal proceedings
- Maintains withdrawal availability
FAQ Section
Q: Can Binance invest crypto holdings in Treasuries?
A: No—only designated fiat currencies qualify.
Q: How does this affect withdrawal times?
A: BAM must maintain liquidity for instant withdrawals per court requirements.
Q: Will this decision impact SEC's ongoing case?
A: Unlikely—this is an operational measure, not a legal precedent.
👉 Understanding Crypto Regulatory Compliance
Key Takeaways
- Limited Scope: Applies to fractional fiat reserves only
- Short-Term Focus: 28-day T-bills ensure liquidity
- Regulatory Nuance: Demonstrates courts balancing consumer protection with business continuity
This analysis avoids speculation—focus remains on factual court provisions and their immediate implications.
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