In the latest twist of events surrounding Binance, the United States District Court for Washington, D.C. has issued a summons for Binance CEO Changpeng Zhao. This development follows the recent lawsuit the US Securities and Exchange Commission (SEC) filed against the exchange, alleging violations of US securities laws.
The summons, issued on June 7th, grants Zhao 21 days to respond to the legal action. Also, it explicitly states that a lawsuit has been filed against him in relation to the SEC complaint. While it remains unclear if the summons has been officially served, once it is, the countdown for Zhao’s response will begin. The document warns that failure to respond may result in a judgment by default being entered against him, as demanded in the complaint. Although Zhao may not need to appear physically, it is necessary for him to acknowledge and respond to the summons once it has been served, as per legal requirements. It has been served as per legal requirements.
Binance CEO reacts to the news on Twitter
Changpeng Zhao responded on Twitter to the news saying that this is part of the SEC complaint process and nothing new about it.
Binance has yet to respond to the summons formally, but the exchange has already expressed its intention to contest the SEC’s complaint. Coinbase, another major cryptocurrency exchange, is facing a similar lawsuit from the SEC, although it does not include allegations of mismanagement of customer funds
The summons for Changpeng Zhao comes just two days after the SEC filed a lawsuit against Binance, accusing the exchange of engaging in unregistered securities operations. The SEC’s lawsuit includes multiple charges related to the alleged unregistered sales of internal products and services, the cryptocurrency staking program, and the supposed failure to register Binance’s primary and US arms as exchanges properly.
While details surrounding the summons are currently limited, it appears it has not yet been marked as served. Both the SEC and Binance have not provided immediate clarification regarding the summons.
Once the summons is served, Binance and Changpeng Zhao will have 21 days to respond. The outcome of this legal battle will have significant implications for the cryptocurrency exchange and the broader digital asset industry.