Federal Judge Approves Binance.US to Invest Customer Assets in U.S. Treasury Bills
Binance’s U.S. Affiliate Granted Approval to Invest Customer Assets in U.S. Treasury Bills
In a significant development for the cryptocurrency industry, Binance’s U.S. affiliate has received approval from a federal judge to invest certain customer assets in U.S. Treasury bills. This ruling marks a pivotal moment for Binance.US, as it lifts restrictions previously imposed by the U.S. Securities and Exchange Commission (SEC).
The court order mandates Binance.US to transfer cryptocurrency to a third-party custodian that is not affiliated with the exchange. Additionally, the operator of Binance.US, BAM, has been granted permission to invest certain customer fiat funds held at the crypto custody firm BitGo into U.S. Treasury bills. These investments will mature on a rolling four-week basis, ensuring no involvement from third parties, including Binance entities, as stipulated by the court order.
Treasury bills, known as T-bills, are short-term government securities that mature within a year and are considered one of the safest investments, backed by the full faith and credit of the U.S. government. This move is expected to enhance customer confidence in Binance.US, reassuring users about the security and prudent management of their assets.
The SEC’s allegations against Binance last June accused the exchange, its CEO Changpeng Zhao, and the operator of Binance.US of various wrongdoings, including artificially inflating trading volumes and misappropriating customer funds. Following these allegations, Binance and Binance.US reached an agreement with the SEC to ensure that U.S. customer assets would remain within the United States.
This decision also reflects a growing trend among cryptocurrency platforms to integrate more traditional financial instruments into their asset management strategies. By leveraging Treasury bills, Binance.US is taking a step towards bridging the gap between conventional financial systems and the emerging digital asset economy.
Overall, this approval signifies a positive step forward for Binance’s U.S. operations and could potentially set a precedent for other cryptocurrency exchanges looking to enhance their asset management practices.
