Armanino, An FTX.US Accounting Firm, Is Closing Its Crypto Audit Practice And Dumping Clients

Armanino, an FTX.US accounting firm, has closed its encryption auditing business and terminated its clients.

Other industry clients feel that Armanino’s reputation risk will cast doubt on its audit results, putting this audit firm under pressure.

Armanino also serves as an accounting firm for cryptocurrency exchanges including Gate, OKX, and Kraken. According to reports, the firm began providing assistance to the cryptography business in 2014, offering proof of reserve audits and proof of stablecoins.

According to a person familiar with the firm’s crypto products, the unit may be folding due to pressure from Armanino’s non-crypto clients, who are afraid that a reputational risk to the firm will call its audits into doubt. This firm was mentioned in a class-action complaint this month for failing to detect problems at FTX.US during the exchange’s audit last year. Stephen Pierce, an FTX customer who allegedly lost $20,000, filed the lawsuit.

According to the Wall Street Journal, venture capital firm Sequoia Capital has reportedly warned fund investors that it will need even early-stage businesses’ financial statements to be audited by a Big Four accounting firm, hence increasing demand for crypto audit services.

Following the FTX scandal, US investors sued FTX’s auditors, Prager Metis and Armanino, accusing them of extortion conspiracy.

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