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US Court Gives Binance CEO 21 Days to Respond to Summons
CZ has 21 days to respond to the summons issued today, though he does not have to do so in person.
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This Wednesday, a summons intended for the CEO of Binance, Changpeng Zhao, was filed in the United States District Court for the District of Columbia. The summons is part of a recent SEC lawsuit and gives CZ 21 to respond or risk a “judgment by default”.
US District Court Issues Summons to Changpeng Zhao
On June 7th, the United States District Court for the District of Columbia issued a summons to the CEO of Binance, Changpeng Zhao. The summons pertains to the recent lawsuit filed by the SEC against Zhao, as well as his company.
On Twitter, Binance’s CEO confirmed the veracity of the summons but pointed out that he mustn’t respond to it in person. He also stated that he believes that the filing is part of standard procedure and that anyone claiming it is bigger than that is spreading “FUD” (fear, uncertainty, and doubt).
Throughout Wednesday, the price of multiple digital assets continued its decline which dramatically started on Monday and was reinforced on Tuesday after the SEC unveiled its lawsuit against Coinbase, the second of the week. Binance’s BNB was especially affected and declined to under $260 by the afternoon of June 7th.
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Binance Hit With a Major SEC Lawsuit
Binance, along with its various entities, became the target of a major SEC lawsuit on Monday, June 5th. Additionally, the Commission named the company’s CEO, Changpeng Zhao in the lawsuit.
The regulator alleges numerous wrongdoings in its filing including the offering of unregistered securities, allowing access to US customers without being properly registered for it, comingling assets, and wash trading.
Despite this week offering what could be described as the SEC’s most dramatic actions this year, the Commission has been very active when it comes to targeting the cryptocurrency industry throughout 2023. It has initiated enforcement actions against various digital assets firms, and has, notably. settled with Kraken on the condition that the firm discontinues its staking service.
Do you think the SEC will win its lawsuit against Binance and Changpeng Zhao? Let us know in the comments below.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
