After a judge refused to grant the US Securities and Exchange Commission (SEC) unlimited access to Binance.US software in a hearing on September 18, Binance CEO Changpeng Zhao (CZ) appealed to X (formerly Twitter) to make a statement regarding a point of contention with the SEC.
"For the record. Binance US does not use, and has NEVER used, Ceffu or Binance Custody. You can't just make these things up," CZ said in a post on September 19. CZ's statements do not clarify things.
For the record. Binance US does not use, and has NEVER used, Ceffu or Binance Custody.
You can't just make this stuff up. โโ๏ธ https://t.co/JIkIVTf8tc
- CZ Binance (@cz_binance) September 19, 2023
The role Ceffu played in the Binance.US ecosystem has been a concern for the SEC because Binance.US agreed to the SEC's June 17 consent order, which fixed:
"For the avoidance of doubt, US-based BAM Trading and BAM Management staff will have full control over the client's fiat and crypto assets."
BAM is the holding company of Binance.US. Bloomberg reported in May, citing a 2022 corporate filing, that the company Ceffu runs was owned by CZ, which is not based in the United States.
Cefu aware a statement on its website on September 15 disputing an SEC claim in a September 14 court filing linking it to Binance.US. Ceffu stated that it provides services โin select jurisdictions, excluding the United States, among others.โ
Related: SEC Sees Temporary Setback in Binance.US Software Access Request
However, a Binance.US document titled โBinance.US Digital Assets and Custody Operations Policyโ that was marked โConfidentialโ and submitted to the court on September 15, in a section titled โSystems. General description", fixed:
โWe have licensed the wallet custody software and support services from Ceffu (formerly Binance Holdings Limited). [...] The Ceffu solution makes up the majority of our wallet technology.โ
Binance launched Binance Custody in 2021. Ceffu was later renamed Binance Custody. In March, a Binance spokesperson told Cointelegraph that Ceffu was their โindependent institutional custody partner.โ
So @cz_binance trying to claim that Binance US never used "Ceffu" because at the time the agreement was signed, Ceffu was called "BHL Wallet Solution" and the entity was Binance Holdings Limited, which later became Ceffu.
But he also forgets, his own lawyers also admitted the new... pic.twitter.com/373LEiNuaD
- Adam Cochran (adamscochran.eth) (@adamscochran) September 19, 2023
In its September 18 court filing, the SEC referred to Ceffu as a "mysterious entity related to Binance" and noted that Binance.US has been inconsistent in its descriptions of its relationship with Ceffu in its dealings with the agency. "It is more than likely that BAM still does not understand what Ceffu is," the SEC stated.
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