By Sabela Ojea
Binance said it is disappointed with the lawsuit filed on Monday by the Securities and Exchange Commission alleging it was operating an illegal trading platform in the U.S.
The world's largest cryptocurrency exchange said in a blog post that it disagrees with the SEC complaint, which names founder, controlling shareholder and CEO Changpeng Zhao as a defendant.
Zhao and Binance allegedly misused customers's funds and diverted them to Sigma Chain, a trading firm Zhao controlled, according to the SEC lawsuit.
Binance expected to reach a settlement with the U.S. regulator, but "the SEC abandoned that process and instead chose to act unilaterally and litigate," the company said in a response to the SEC's complaint.
"Any allegations that user assets on the Binance.US platform have ever been at risk are simply wrong," Binance added.
U.S. regulators have been circling Binance for years, with the SEC and Justice Department issuing subpoenas to the exchange's U.S. arm in late 2020, according to documents viewed and previously reported on by the Journal.
Officials have since ramped up enforcement efforts over the past year after the collapse of numerous cryptocurrency companies, including one of Binance's biggest rivals, FTX.
Write to Sabela Ojea at sabela.ojea@wsj.com; @sabelaojeaguix
(END) Dow Jones Newswires
06-05-23 1502ET
