Binance Gets Court Approval to Invest U.S. Customer Funds in Treasury Bills

• Court permits Binance.US to invest customer funds in U.S. Treasury bills, ensuring secure, low-risk investments.
• SEC lawsuit led to court ruling allowing Binance.US to use Treasury bills, improving regulatory adherence.
• Binance.US invests customer funds held by BitGo in Treasury bills, maturing on a rolling four-week basis.

Binance’s U.S. affiliate has received court approval to invest customer funds in U.S. Treasury bills. This decision, handed down by a federal judge, allows Binance.US to move certain customer assets into these secure government securities.

Court Ruling Provides Flexibility

The court order allows Binance.US to invest customer fiat funds, currently held by the crypto custody firm BitGo, into U.S. Treasury bills. These investments will mature on a rolling four-week basis. Importantly, no third parties, including Binance entities, are involved in these transactions.

This ruling comes after the SEC’s lawsuit against Binance, its CEO Changpeng Zhao, and Binance.US operator BAM. The SEC alleged that Binance inflated trading volumes, misused customer funds, and misled investors. In response, Binance and Binance.US agreed to keep U.S. customer assets within the country.

Details of the Court Order

The court document specifies that Binance can invest “certain customer fiat funds” in Treasury bills. The approval was signed by Judge Amy Berman Jackson, overseeing the SEC v. Binance case. The ruling allows Binance to use third-party investment advisors not linked to Binance for managing these investments.

Last year, Binance settled with the U.S. Justice Department, resulting in a $4.3 billion fine and the resignation of then-CEO Changpeng Zhao. The SEC also dropped an investigation into Paxos regarding the Binance USD stablecoin.

Benefits of U.S. Treasury Bills

U.S. Treasury bills are considered a low-risk investment supported by the U.S. government’s full faith and credit. They offer liquidity and a predictable return, making them ideal for preserving capital while earning modest interest. By investing in Treasury bills, Binance can enhance the safety and return on investment for its users.

This court approval marks a forward step for Binance.US in managing its regulatory challenges and ensuring the security of customer assets. The decision allows the exchange to invest customer funds in a manner that aligns with regulatory requirements while offering a stable investment option.