Binance.US Resorts to Job Cuts as It Prepares for Long and Costly Litigation With SEC: Report

In a letter to employees, Binance said it expects lengthy and expensive litigation with the US Securities and Exchange Commission (SEC) and asked Binance.US management to reduce the size of the workforce across the division.

The decision to cut the job will likely affect about 50 employees.

Binance.US Job Cuts

bloomberg a report He indicated that a number of employees have been laid off at the Binance branch in the United States. While a company spokesperson confirmed the layoffs, the exact number of employees affected by the decision was not mentioned.

However, a Reuters report indicated that around 50 employees have been affected.

Earlier this month, Binance.US said it was cut off from its banking and payments partners. On June 9, the cryptocurrency exchange was only serving US customers hanging deposits in US dollars and asked users to withdraw their dollar deposits immediately, given the SEC’s “extremely aggressive and intimidating methods”.

Recently, Binance CEO Changpeng Zhao dismissed the notion that the company sold BTC and BNB, describing the rumors on social media as FUD. And CZ confirmed that the company even keeps its own “FTT bag.”

In intersection with the SEC

In the lawsuit filed on June 5, the SEC asked the court to freeze the assets and operations of Binance.US. However, the authorities rejected the SEC’s request on June 14 and asked Binance.US and the agency to communicate with each other and find a solution.

“Turning it off completely will have dire consequences not only for the company but for digital asset markets in general. (Work on it) — you’d better deal with the nitty gritty than with me.”

These developments indicate that the sudden hardening in the stance of US regulators after the collapse of FTX in November 2022 has finally caught up with the major players in the industry. The US Securities and Exchange Commission filed lawsuits against Binance and Coinbase on June 5 and June 6, respectively.

The charges brought by the commission against the duo included acting as exchangers, brokers, dealers and clearing houses without proper licenses. Binance has been tasked with managing two unregistered securities – BNB and BUSD – and consolidating clients’ funds. The SEC has argued that Binance and Coinbase allow trading in tokens, which are unregistered securities.

The regulator wants exchanges and tokens to adhere to the guidelines that apply to securities. This means following the rulebook and doing adequate disclosure that helps investors mitigate risks and make informed decisions.