Binance CEO Changpeng Zhao (CZ) has been sued by a U.S. District Court. for the District of Columbia following a lawsuit against him and his exchange on Monday.
The CEO was given a period of 21 days to respond to the summons without any obligation to appear in person.
In addition to Binance's CEO, the entities involved in the lawsuit are Binance and Binance US who must also respond to the suit. Based on the filing, there is an outline "If you fail to answer, the judgment will be more complicated."
According to a 136-page Securities and Exchange Commission (SEC) filing against Binance on Monday, the commission wants to set aside the ill-gotten gains of its own interests and to permanently enjoin the firm from engaging in cryptocurrencies and securities.
The suit alleges that Binance sells unregistered securities in the form of BNB and BUSD, and operates as an unregistered securities exchange and broker-dealer in the United States.
The SEC also accused the firm of not maintaining independence from Binance US, combining billions of dollars of funds from both firms in Merit Peak, an entity controlled by CZ.
Binance US was faced with a restraining order to have its assets frozen by the SEC on Tuesday, pending court approval. The order does not affect those global exchanges.
