The legal proceedings between the SEC and Binance (BNB) are set to be temporarily halted for sixty days, during which time both parties will await updates from the newly established Crypto Task Force.
In a joint motion filed on February 10th, it was indicated that the pause may be extended depending on the findings of the Task Force’s report. A portion of the filing stated:
“Upon the conclusion of the 60-day pause period, the Parties plan to present a joint status report, assessing whether an extension of the pause is necessary.”
It is argued by the involved parties that the report from the task force, intended to bring more regulatory clarity to the industry, could have a significant impact on, or potentially resolve, the ongoing case.
It remains to be seen if other entities like Ripple, Coinbase, and Kraken, who are also embroiled in legal battles, will take similar actions as Binance following this development.
However, Alex Thorn, the Head of Research at Galaxy Digital, expressed his belief that by mid-April, the update would shed light on the security status of various alternative cryptocurrencies.
He mentioned,
“With both the SEC and Binance agreeing to a 60-day pause in their legal proceedings – essentially requesting the court for a temporary hold while they reassess – we anticipate that by April 12, the SEC will have formulated a new stance regarding the security classification of cryptocurrencies.”
Disputing Allegations Against Binance
Binance has refuted claims indicating that they have liquidated assets such as Bitcoin and Ethereum reserves.
The company reassured users that their funds are secure and clarified that any alleged ‘sell-off’ was solely part of an internal accounting adjustment. Their statement affirmed,
“Binance has not engaged in any asset liquidation. The adjustments made in the Binance treasury’s accounting procedures were purely routine. Users can rest assured that their funds are completely secure – as they have always been.”
Interestingly, reports about Binance’s alleged sell-off initially surfaced through crypto analyst Kuai Dong, who referenced data from Binance’s proof of reserve.
Dong alleged that the exchange had converted most of the profits earned from major tokens like BTC, ETH, SOL, and USDT to USDC.
In part of his analysis, he wrote,
“Currently, a significant portion of the available currencies have been exchanged for the stablecoin USDC, with BNB experiencing the smallest reduction ratio at just -16.6%. Examining market conditions from January, many currencies were at all-time highs.”