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Binance, The greatest cryptocurrency market in the world, denied a report published by forbes titled “binance’s asset shuffling eerily similar to maneuvers by ftx,” which argues that the crypto giant transferred $1.8 billion associated with its users’ funds.
According to Forbes, between August 17 and early December 2022, BINANCE moved “silently” $1.8 billion deposited “as collateral intended to support its customers’ stablecoins,” leaving many of its users with unbacked funds.
Despite the company's assertion that it had fully checked its reserves and had never received deposits from its clients.
What Forbes is talking about.
Forbes claims that $1.1 billion of the client-sourced funds in USDC chips, the stablecoin issued by Circle, were sent to Cumberland/DWR, a high-frequency trading company based in Chicago. Forbes reports that the company "may have helped Binance in its efforts to turn collateral into its own stable Binance USD (BUSD)."
Forbes also asserts that other relevant players within the crypto ecosystem, For example, Amber Group, The search for Alameda by Sam Bankman-Fried, and Trudeau by Justin Sun, has been awarded hundreds of millions of dollars by Binance.
According to Forbes' review of blockchain data, From August 17 to the beginning of December, around the same time that FTX imploded, the holders of more than a billion dollars of known cryptography as USDC B-peg tokens have been left unsecured for instruments which, according to Binance, would be supported 100% by the token to which they were attached."
Forbes suggests that Binance's handling of his clients' funds mirrored the actions of FTX prior to filing for bankruptcy. American researchers say ftx sent money to alameda research even if it was banned.
The clause says that just because binance is not regulated as a standard financial corporation, it doesn't automatically mean that their transactions are illegal. However, it is easier for regulators to require regulated firms to separate from depositories of their clients' assets.
Binance addresses the claims of Forbes.
Binance responded to Forbes' claims that user funds were mismanaged, denying any fault. The company’s spokesperson assured the transactions in question were part of their internal billing processes and did not affect the collateralization of user assets.
Although binance has already recognized that the portfolio management processes for binary token guarantees have not always been impeccable, the guarantee of user assets has never been impacted. Processes for managing our collateral wallets have been fixed on a longer-term basis and this is verifiable on-chain.”
Later on, Binance’s CSO, Patrick Hillman, explained that capital movements between wallets were normal and that the exchange does not mix its assets with clients’ funds. He invited interested parties to check the truthfulness of their declarations in the public blockchain registers.
Binance's efforts to combat the effects of negative advertising are not superficial. The exchange has been called into question in a number of situations which have tarnished his image. From the CEO of FTX accusing the Binance CEO of orchestrating the downfall of his exchange to an uproar caused by the confirmation that, on previous occasions, Binance failed to collateralize its BUSD stablecoin by up to $1 billion.
And beyond that, the stability itself is now under the microscope of regulatory agencies. Paxos stopped minting it after it was revealed that the SEC was investigating the firm, and US exchanges are already watching their backs, with COINBASE taking the first step and delisting the token.
