SEC Summons Binance CEO CZ as Lawsuits Shake Cryptocurrency Industry

The United States District Court in Washington, D.C., at the request of the Securities and Exchange Commission (SEC), summoned Binance CEO Changpeng Zhao (CZ) on Wednesday.

Binance CEO CZ Challenged by SEC Summons as Legal Battles Escalate

On Wednesday, several social media accounts shared a summons intended for the CEO of Binance, Changpeng Zhao, also known as CZ. The document states that CZ must respond upon being served, and at that time, he will have 21 days to address the court. “If you fail to respond, judgment by default will be entered against you for the relief demanded in the complaint,” the court filing details.

I was told this is just part of the SEC compliant process. Nothing new.

Also told I won't have to appear in person. No need to FUD. pic.twitter.com/NYUlBCIirG

— CZ Binance (@cz_binance) June 7, 2023

The summons necessitates a response and bears the signature of the court clerk. CZ was served at his residence in Malta, and he shared a tweet about the document on Twitter. The summons comes in the wake of the recent SEC lawsuit against Binance and CZ, accusing them of operating an unregistered exchange, brokerage, and clearing house, as well as listing unregistered securities. Furthermore, the SEC has filed a motion to freeze the assets linked to Binance’s American subsidiary, Binance US.

Binance has disputed the allegations made by the U.S. securities regulator and stated that the company plans to “vigorously defend” the platform. The largest cryptocurrency exchange in the world in terms of trade volume stated that the SEC’s “refusal to productively engage with us is just another example of the Commission’s misguided and conscious refusal to provide much-needed clarity and guidance to the digital asset industry.”

The U.S. securities watchdog filed a lawsuit against Coinbase the day after it lodged a complaint against Binance and CZ. Additionally, several states have issued show-cause orders to Coinbase, alleging that the company has listed unregistered securities and targeted its staking service. In response to the SEC’s allegations, Coinbase has argued that the regulator’s enforcement actions without clarity are “hurting America’s economic competitiveness.”

What are your thoughts on the SEC’s lawsuit against Binance and CZ’s summons? Share your thoughts and opinions about this subject in the comments section below.