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Binance customers represented by entity, citing inadequate representation

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A third-party entity named “Eeon” has stepped forward to intervene in the case, representing the interests of Binance’s customers regarding the lawsuit filed by the United States Securities and Exchange Commission (SEC) against Binance.

As stated in the filing with the District Court for the District of Columbia, Eeon claims that the SEC and Binance’s attorneys have failed to sufficiently represent the interests of Binance’s customers, leading Eeon to seek representation for them.

In the filing, Eeon asserted, 

“We are the appropriate parties involved in this case, as the Court identified us as ‘Customers’ in its Order dated June 17, 2023. We are not ordinary customers; rather, we are stakeholders, investors and owners of cryptocurrency held by Binance and its subsidiaries. We firmly believe that our interests were not adequately considered.”

Eeon contends that crypto coins should be deemed commodities, not securities, as they are predominantly utilized for personal and household use rather than commercial purposes. Additionally, Eeon highlights the absence of specific regulations for this emerging commodity category, which consequently limits the SEC’s jurisdiction over cryptocurrencies.

Eeon claims Binance controls customers’ crypto assets by blocking access and withdrawals without proper notice. They argue that the SEC’s actions worsened the situation for investors instead of safeguarding their interests, accusing the SEC of wrongly accusing customers of money laundering. Eeon requests a court order to grant customers access to their frozen assets on Binance platforms.

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Screenshot of the court filing.  Source: Court Listener

Additionally, Eeon argues that offshore fund transfers are a common and accepted practice, distinct from money laundering. Various entities like e-commerce platforms, freelance services, consulting firms, small export companies and travel agencies routinely participate in international money transfers without being associated with money laundering activities.

Related: Binance headcount reduction hits 1,000 employees: Report

In its counterclaim, Eeon seeks compensation from both Binance and the US SEC, equivalent to 20% of the daily value of withheld funds per customer, totaling $1000 per day. Additionally, both Binance and the US SEC would be equally responsible for paying penalties, with $500 assigned to the US SEC and $500 allocated to Binance and its subsidiaries.

Cointelegraph has reached out to Binance for more information on this case but is yet to receive feedback at the time of this publication.

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