A few days ago, information from Forbes, reported that Binance had made suspicious use of a sum of $ 1.8 billion, belonging to its customers. This sum represents a guarantee of the stablecoins held by the clients of the crypto exchange. Such an attitude is contrary to the proper functioning of exchanges. This is what plunged FTX into bankruptcy. In view of the risks associated with such an operation, the case is causing a stir in the crypto community. But Binance denies everything. Explanation.
Binance denies questionable use of customer funds
After the posted by Forbes, of a report that Binance had used $ 1.8 billion in collateral from its customers for unclear purposes, the largest crypto exchange in the world replied in the negative. To provide the information, Forbes relied on on-chain data. The daily also highlighted the fact that Binance moved these funds without informing its customers. Recall that the information from Forbes covers the period from August to December 2022.
Of the total envelope, 1.1 billion dollars would have been transferred to DRW, a trading company based in Chicago. This company may, according to Forbes, have helped Binance in its efforts to turn collateral into BUSD. Other recipients would include SBF’s Alameda Research, as well as Amber Group, and Justin Sun, founder of Tron.
CZ, the boss of Binance said he regretted the publication of this false article. According to him, it was produced on purpose to weaken his exchange.
In interview given to The Blocka Binance spokesperson dismissed Forbes’ accusations.
“The identified on-chain transactions relate to the internal management of the portfolio. At no time was the guarantee of user assets affected. This, although Binance has previously acknowledged that portfolio management processes for token collateral have not always been flawless”did he declare.
For his part, Binance Chief Strategy Officer Patrick Hillman told Forbes that “the movement of money between multiple wallets is not a problem”. He continued that this is standard practice within the company. Anyway, it would be curious if Binance used its clients’ funds for other purposes. After FTX went bankrupt, CZ advised the rest of the crypto exchanges never to touch client holdings.
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