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Global cryptocurrency exchange Binance had secret access to a bank account belonging to its purportedly independent U.S. partner and transferred large sums of money from the account to a trading firm managed by Binance CEO Changpeng Zhao, banking records and company messages show, Reuters reported. Over the first three months of 2021, more than $400 million flowed from the Binance.US account at California-based Silvergate Bank to this trading firm, Merit Peak Ltd, according to records for the quarter, which were reviewed by Reuters. The Binance.US account was registered under the name of BAM Trading, the U.S. exchange's operating company, according to the records. Company messages show the transfers to Merit Peak began in late 2020. The exchange's public terms of use at the time said its customers' dollar deposits were held at Silvergate and a Nevada-based custodian firm called Prime Trust LLC. Prime Trust made $650 million in wire transfer deposits into the Binance.US account during the quarter, the bank records show.

The U.S. Securities and Exchange Commission is preparing to sue the company behind TerraUSD, a crypto stablecoin whose collapse last year kicked off an industry wide crisis and a cascade of high-profile bankruptcies, Bloomberg News reported. The SEC has been investigating whether Terraform Labs, the company behind the token, misled investors about the stablecoin’s ability to maintain a 1-to-1 peg to the U.S. dollar, according to people familiar with the matter. The lawsuit will allege that TerraUSD should have been registered with the agency, said one of the people, who like the others asked not to be named discussing the plans. “Terraform Labs has not been contacted about such a proceeding by the SEC and thus cannot comment,” the company said in a statement. The SEC declined to comment. Although the case is in its final stages, timing and plans could change. TerraUSD, or UST, was supposed to maintain its peg through an algorithm and trading in a sister token called Luna — an experiment that failed spectacularly when the stablecoin crashed last May, sparking a massive selloff. The token’s implosion kicked off a domino effect across crypto markets. It directly, or indirectly, fueled bankruptcies in high-profile companies, including hedge fund Three Arrows Capital, Voyager Digital, and, most prominently, Sam Bankman-Fried’s Alameda Research and FTX.

A federal judge showed growing impatience Thursday with FTX founder Sam Bankman-Fried’s use of the internet, suggesting that incarceration might eventually be the most effective way to prevent him from violating his bail conditions by communicating on electronic devices in ways that can't be traced, the Associated Press reported. Judge Lewis A. Kaplan did not immediately change a $250 million bail package that lets Bankman-Fried live with his parents in Palo Alto, California, while preparing for trial on charges that he cheated investors and looted customer deposits at FTX, his cryptocurrency trading platform. But he raised the possibility for the first time that jail might be the only way to ensure Bankman-Fried won't outfox the government with ways to use electronic devices in ways that can't be tracked. “There is a solution, but it’s not one anybody’s proposed yet,” Kaplan said as Bankman-Fried sat passively at the defense table. He then noted that there may be many devices in Bankman-Fried's family home that the government will not be tracking, even with any new rules imposed on his bail conditions.

The largest creditor in the long-running bankruptcy process of the Mt Gox crypto exchange has opted for an early payout in Bitcoin rather than fiat currency, easing some concerns about the token’s price outlook, Bloomberg News reported. Mt Gox Investment Fund has picked an early payout in September this year. The fund decided against waiting for all the litigation around the failed exchange to be resolved, which could take as many as nine years. The fund will get 90% of what’s collectible. The bankruptcy trustee won’t have to sell tokens in the open market since the creditor chose to receive Bitcoin. Such sales could have sapped Bitcoin’s price. Mt Gox creditors have until March 10 to decide whether to chose the September payout or to wait longer to recover a higher percentage of their claims. Tokyo-based Mt Gox was at one time the world’s biggest Bitcoin exchange. It lost some customer assets and went bankrupt in 2014.

Auto parts maker Stanadyne LLC filed for bankruptcy Thursday, saying it has been “crippled” by the rising costs of variable-rate debt owed to top creditor Cerberus Capital Management LP, WSJ Pro Bankruptcy reported. Interest rates on the automotive supplier’s $273 million in debt have risen “into the teens,” according to a sworn declaration by Chief Executive Officer John Pinson, with potentially more rate increases on the horizon as benchmark rates rise. Stanadyne can’t keep operating with the current debt load and filed for chapter 11 protection to get breathing room to reorganize as a financially stable business, according to his declaration filed in the U.S. Bankruptcy Court in Wilmington, Del. The company, which has $3.8 million in cash on hand, has been negotiating with Cerberus since November, Mr. Pinson said. Jacksonville, N.C.-based Stanadyne designs and makes fuel injectors, pumps and other parts for diesel and gasoline internal combustion engines, serving both the original equipment market and the aftermarket for everything from passenger vehicles to tractors to utility vehicles. It says its roots date back more than 140 years. Stanadyne has 468 U.S. employees working in states that include South Carolina, North Carolina and Michigan. The company also has affiliates in Italy, the United Arab Emirates, India and China. It said it has made nearly $100 million of capital expenditures in its manufacturing plants since 2014.

Bed Bath & Beyond Inc. executives told suppliers on a video conference call yesterday that the company would pay them in advance for their merchandise or upon delivery, part of the retailer’s effort to win over skittish manufacturers and put the troubled business back on track, Bloomberg News reported. Executives told suppliers that they intend to use funds from a recent equity offering to get more products into the company’s stores. Shelves have been sparse because Bed Bath & Beyond has struggled to pay manufacturers. But the impact won’t be immediate, interim Chief Financial Officer Holly Etlin told suppliers. The home-goods retailer secured an equity offering last week that will potentially allow it to raise as much as $1 billion over time. “While we think that that will be the necessary funding to fund the turnaround, it isn’t all here right now,” Etlin said. “It came in — a small amount up front — and then $100 million a month over the next few months until we get up to the committed amount.” The equity deal is underpinned by anchor investor Hudson Bay Capital Management, a New York-based hedge fund. Bed Bath & Beyond is “prepared to pay” cash in advance or on delivery to suppliers to convince them to sell their products to the retailer, Etlin said during the presentation. Suppliers have been demanding upfront payments for months because they were concerned about not being paid for their goods. But the company — short on cash — hasn’t been able to meet those requests, so many suppliers limited or halted their shipments. “We don’t expect you to come forward immediately, but we hope that we will ultimately restore your trust in us,” said Etlin, a restructuring expert at consulting firm AlixPartners who joined Bed Bath & Beyond last week on a temporary basis.

Bankrupt home-goods retailer Tuesday Morning Corp. has received a $15 million lifeline to support its reorganization effort while its secured lenders push to shut down all 464 of its stores and liquidate its inventory to cash out, WSJ Pro Bankruptcy reported. Judge Edward L. Morris of the U.S. Bankruptcy Court in Dallas on Wednesday allowed investment firm Invictus Global Management LLC to finance the off-price retailer’s bankruptcy process with a $15 million loan, less than a third of the proposed amount of $51.5 million. Judge Morris said the emergency loan is enough to avoid immediate, irreparable harm to the company and its stakeholders until he can determine whether the business has a chance to reorganize under chapter 11 or if it will be better off simply liquidating its inventory. The judge scheduled a hearing in early March to revisit the financing. A restructuring sponsored by Invictus would cut the number of stores by more than half under chapter 11, bringing the company out of bankruptcy with about 200 locations intact. Wells Fargo Bank NA and other secured lenders oppose the retailer’s plans, arguing that an orderly liquidation of inventory would maximize recoveries for creditors compared to a risky reorganization attempt.

Sinclair Broadcast Group Inc.’s regional sports business, Diamond Sports Group LLC, is preparing to file for bankruptcy soon, after having missed a $140 million interest payment to its bondholders, WSJ Pro Bankruptcy reported. Diamond Sports has engaged law firm Paul Weiss Rifkind Wharton & Garrison LLP to advise on its financial restructuring. The company’s earnings have been pressured by the cord-cutting trend, leading to lower-than-expected revenue that can’t sustain the payments it has to make to professional sports teams and leagues for broadcast rights. Its earnings were also hit after it lost a major contract with Dish Network Corp. in 2021. Diamond Sports has a debt load of more than $8 billion, stemming from Sinclair’s acquisition of sports networks from Walt Disney Co. in 2019 for $10.6 billion.