In the face of growing concerns and inquiries from the United States Securities and Exchange Commission (SEC), Binance CEO Changpeng Zhao (CZ) recently voiced his perspective on X (previously known as Twitter). His comments focused on the relationship between Binance.US and Ceffu, adding more layers to the ongoing confusion.
In a September 19 post, CZ clarified, “For the record. Binance US does not use, and has NEVER used Ceffu or Binance Custody. You can’t just fabricate these allegations.” However, CZ’s statement seemed to further muddy the waters rather than clarifying them.
The SEC’s concerns primarily stem from the role Ceffu plays within the Binance.US ecosystem. The intricacies of this relationship came under scrutiny after Binance.US consented to the SEC’s June 17 order which explicitly noted that U.S.-based personnel for BAM Trading and BAM Management would possess “complete control over Customer Fiat Assets and Customer Crypto Assets.”
Yet, a Binance.US document titled “Binance.US Digital Asset & Custody Operations Policy” labeled as confidential and submitted to the court on September 15 contradicted this. The document revealed, “We license wallet custody software and support services from Ceffu (formerly Binance Holdings Limited). […] The Ceffu solution constitutes the bulk of our wallet technology.”
It’s noteworthy that Binance introduced Binance Custody in 2021, which was later rebranded as Ceffu. In a conversation with Cointelegraph earlier this year, a Binance representative referred to Ceffu as their “autonomous institutional custody ally.”
Furthermore, BAM, the holding company behind Binance.US, is seemingly intertwined with Ceffu. A Bloomberg report from May 2022, referencing a corporate filing, indicated that the entity operating Ceffu was under the ownership of CZ, who isn’t U.S.-based.
Adding to the narrative, Ceffu disputed an SEC claim from a September 14 court filing, which connected it with Binance.US. Through a statement released on September 15, Ceffu clarified its stance, asserting that it offers services in “selected regions, excluding the United States among others.”
This intricate web of claims and counterclaims leaves observers, regulators, and participants awaiting further clarification on the true nature of these entities’ relationships.