SEC is conducting a ‘fishing expedition’ instead of seeking discovery, Binance.US claims

Binance.US operators claims the SEC is being “unreasonable” with its requests

article-image

Scott Maxwell LuMaxArt/Shutterstock modified by Blockworks

share

The operators of Binance.US are seeking to limit the US Security and Exchange Commission to four depositions of BAM employees. They are also pursuing limitations on the scope of questioning during these deposition sessions.

BAM Trading, BAM Management filed a motion for a protective order in the SEC’s case against the exchange.

The motion aims to prevent the SEC from accessing “all communications” from BAM. The defendants argue that many of the topics the SEC is pushing for have nothing to do with customer assets. 

The SEC is also requesting the CEO, chief financial officer and “at least six employees and officers” to be made available for depositions, which is more than the four witnesses that BAM offered previously. 

It’s unclear who BAM offered, as the filing just says that the witnesses include the “two best positioned to address questions about the custody and security of customer assets.”

Binance.US operators further claim that the SEC’s “position is unreasonable” and that the regulatory agency is “abusing” the limited expedited discovery that the Court ordered earlier this summer. 

Both BAMs claim that the SEC’s requests go deeper than just ensuring that customer assets are safe; they believe that the requests are part of the SEC’s “inappropriate fishing expedition” to uncover any evidence that customer assets are at risk. 

However, Binance.US says that the demands are being made without a “justifiable basis.” The discovery being sought is outside of the merits of the ongoing case.

Read more: Binance and Changpeng ‘CZ’ Zhao face multiple SEC charges

“In sum, BAM’s CEO and CFO need not be deposed on the limited topics authorized in the Consent Order, and courts regularly preclude such depositions in the circumstances presented here,” the filing said.

The SEC sought — and was later denied — a temporary restraining order against Binance.US earlier this summer. However, the judge overseeing the case urged both the SEC and Binance to find a compromise to avoid a full asset freeze.

Binance, CEO Changpeng Zhao, and the entities behind Binance.US were all named in the SEC’s lawsuit filed in June.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates.png

Research

Ethena Labs is leaping from its flagship synthetic dollar, USDe, to a full product suite—USDtb, iUSDe, and the Arbitrum-based Converge Chain—designed to marry crypto-native yields with TradFi-grade compliance. Our analysis shows how expanding into CME, ETF options, and tokenized Treasuries could lift protocol revenue from sub-$500 million in a bear case to several billion dollars if favorable regulation and institutional adoption align.

article-image

The L1’s Interwoven Stack is the most opinionated tech stack yet

article-image

Bitcoin is still rising, 11 years after the documentary film The Rise and Rise of Bitcoin

article-image

Arch Labs CEO told Blockworks that the team plans to launch a native token, but declined to give details

article-image

CEO Mike Silagadze tells Blockworks that the US is “open for business” and why its DeFi bank offering is the first of many

article-image

Doing one thing well and leaving everything else out is often what disruptive technologies do best