According to the files, the American stock exchange participated in a loan to Changpeng ‘CZ’ Zhao.
In court filings released this week, it was revealed that Binance CEO Changpeng ‘CZ’ Zhao had borrowed $250 million from BAM Management U.S. Holdings, only to give the money to BAM Trading.
Unsealed court filings from June 6 reveal that a day after the SEC slammed Binance with a major complaint, Binance’s US legal team submitted replies to concerns from the agency concerning particular financial maneuvers.
The regulatory agency had some reservations about a January transfer of $183 million from Paxos Trust Company to BAM Trading, which operates as Binance US.
Binance USD (BUSD) is a stablecoin and the 28th largest digital asset by market value, and it was released in 2019 thanks to a partnership between Binance and Paxos Trust, a fintech firm.
Binance US, a cryptocurrency platform that is apparently managed independently from the largest digital asset exchange in the world, is operated by both BAM Trading and BAM Management.
A $250 million convertible note from BAM Management US Holdings to Zhao was issued in December, according to the filings filed by Binance US’ legal team. Zhao “funded the purchase of this note with BUSD, of which $183 million was sent to Paxos Trust Company, as an issuer of BUSD, to convert the BUSD into USD,” the document said.
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