"The allegations of the SEC severely undermined institutional trust in our platform," Binance.US executive Christopher Blodgett said during a deposition.

The Securities and Exchange Commission’s (SEC) move last year to freeze Binance.US’ operations via a Temporary Restraining Order (TRO) resulted in significant layoffs at the company, as revenue plummeted and trust in the market waned, according to one of its executives during a court deposition.

“In the immediate aftermath of the TRO, we saw somewhere in the neighborhood of $1 billion of assets flee the platform, crypto, and fiat,” Christopher Blodgett, a Binance.US executive, said during a December 2023 deposition that was recently published as part of a status update on the SEC-Binance lawsuit.

The depletion of $1 billion in assets resulted in a 75% revenue decrease and the dismissal of 200 employees – equivalent to two-thirds of its workforce – at Binance's U.S.-based branch. This downsizing has hindered the exchange's capacity to address SEC discovery requests as its teams are strained due to the reduced manpower.

Blodgett also mentioned that the exchange faced a substantial surge in legal costs, reaching $10 million, and its auditor expenses ballooned by "10x." Moreover, it lost banking relationships, which enabled customers to convert their digital assets into fiat currencies.

"In the immediate aftermath of the TRO, our banks demanded significant increases in collateral. Eventually, they terminated the relationship entirely. Consequently, our customers were unable to deposit and withdraw fiat from the platform, severely impacting the business," he stated.

Blodgett testified that since then, the exchange has struggled to secure new banking partners.