Binance Responds To Forbes’ False Claims For Misappropriating Users’ Money

Key Points:

• Binance posted on its Official Blog in response to Forbes’ alleged misappropriation of user funds.
• The company said the above allegation is completely untrue because on-chain transactions are spontaneous behavior of organizations or users, it is completely queryable on-chain.
• Binance’s stablecoin BUSD always maintains a 1:1 reserve.
• The company also asserts that there is absolutely no misappropriation of customer funds because it is completely transparent on the Proof of Reserve (PoR) system.

Binance posted on its official blog a response to an article accusing Binance of embezzling nearly $1.8 billion in USDC collateral in 2022 from Forbes on Feb. 27. According to the regulator that is completely untrue.

According to Forbes citing on-chain data, Binance embezzled $1.78 billion worth of B-Peg USDC collateral between August 17 and 24, 2022, where the asset was worth $1.78 billion. $1.1 billion was transferred with high frequency to the trading company Cumberland/DRW, and the remainder went to Amber Group, Alameda Research and Tron founder Justin Sun.

The blog states that remittance is the basic behavior of users on the Binance trading platform as there is a large amount of crypto assets being deposited into the user’s account address every day and a large amount of money. Users withdraw cash to different wallet addresses. For security reasons, it is normal for a large amount of money to be transferred between hot and cold wallets every day.

Regarding the transfer to the address of Amber Group, Alameda Research and Justin Sun mentioned in the Forbes article are all spontaneous acts of these organizations users or individual users. The money transfer behaviors of the above organizations and individuals are public on the chain address and can be queried.

Second, the largest cryptocurrency exchange in the market detailed the issues related to Binance-Peg BUSD in the article: “Binance will regularly rebalance or update the assets of the anchor address. , but prior to this, this rebalancing and updating cannot be guaranteed to be completely real-time, therefore, we increased the frequency of rebalancing and updating before that to ensure that the anchor ratio is 1:1. For details, please refer to the Binance-Peg BUSD operating guidelines.”

Third, Binance has never embezzled user funds, and B-token’s centralized exchange assets and collateral always maintain a 1:1 reserve. All user assets can be viewed through the Proof of Reserve (PoR) system. Binance recently managed B-Token collateral addresses completely separate from centralized Exchange Proof of Reserve (PoR) system addresses, which can be verified via the Tokens Proof of Commitment page. B-Tokens newspaper.

It can be said that, although Binance regularly issues reports to demonstrate the transparency of the exchange for users’ assets, as the largest exchange in the market, it still receives a lot of attention. media attention and scrutiny.

However, it can be seen that after each accusation made, Binance always has an immediate response. This also partly makes users feel secure and causes less FUD effect in the community.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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