Binance gains US court approval to invest customer funds in US treasury bills

Binance just got judicial approval to invest customer fiat funds in US Treasury Bills.

The approval was signed and issued by Judge Amy Berman Jackson, who is overseeing the SEC v. Binance case. The ruling permits Binance to only “invest certain customer assets in United States Treasury Bills.”

The court granted BAM Trading Services Inc. and BAM Management US Holdings Inc. (Binance) the flexibility to manage their assets more freely. This decision allows Binance to engage third-party investment advisors for its corporate assets, particularly in U.S. treasury bills, as long as these advisors are not linked to Binance. 

The court document also stipulates that only “certain” funds can be invested and clarifies that these funds are currently in BitGo’s custody. 

“Notwithstanding any applicable provision of the Consent Order, BAM is authorized to invest certain customer fiat funds currently custodied at BitGo in United States Treasury bills that will mature on a rolling four-week basis,” read the court ruling, followed by three provisions.

The overall court case involves the U.S. Securities and Exchange Commission (SEC) pursuing legal action against Binance.US for allegedly failing to comply with regulatory requirements. 

The charges involve matters concerning the initial coin offering and sales of the BNB token, as well as the BNB Vault program. Additionally, there are allegations of failure to register and non-compliance with anti-fraud regulations.

The SEC is also charging former Binance CEO Changpeng Zhao, arguing that he acted as a controlling person and that the trading platform was required to register under the Exchange Act.

Treasury bills

U.S. Treasury Bills are a popular investment due to their reputation as one of the safest options, supported by the full faith and credit of the U.S. government.

Additionally, Treasury bills offer liquidity and a predictable return, making them ideal for preserving capital while earning a modest interest. By diversifying into Treasury Bills, Binance can enhance the safety and return on investment for its users.