Cryptocurrency exchange Binance denied the information in Reuters with a statement about the mixing of user funds and revenues in 2020 and 2021.
Let me explain just how desperate a journalist @Reuters is to publish a negative story. The whole base of their story this morning, is that when users purchased BUSD (Paxos) from Binance, they were taken to a transaction page that had the term “deposit” on it. Users were making a…
— Patrick Hillmann (@PRHillmann) May 23, 2023
The company’s strategy director Patrick Hillman opined that the agency’s journalists were desperately trying to write a “bad story” that turned out to be “weak”.
“Then they came up with 1,000 words of conspiracy theories (which we explained were false) with zero evidence other than ‘former insider’.” […]. We have been very public about the past regulatory shortcomings of the company,” wrote a top manager.
Hillman’s next tweet wrotethat Binance holds “user and corporate funds in completely separate registries.”
Citing unnamed sources, Reuters reported that the exchange moved billions of dollars almost daily into the company’s accounts at the now bankrupt Silvergate Bank.
“The news agency examined a bank record that on February 10, 2021, Binance mixed $20 million from a corporate account with $15 million from an account that received client funds,” the article says.
Exchange spokesman Brad Jaffe told Reuters that Silvergate Bank accounts were not used to accept deposits from traders, except “to facilitate the purchase of cryptocurrencies by users.”
“There has never been any confusion as these are 100% corporate funds,” he noted.
As a reminder, in March 2023 CFTC filed a lawsuit against the Binance cryptocurrency exchange and its CEO Changpeng Zhao. According to the agency, the platform violated the rules for trading derivatives by operating without proper registration.
Within about a week of the CFTC claims, Binance’s share of the spot market dropped from 70% to 54%.
In February NYDFS launched an investigation into Paxos, a BUSD stablecoin issuer linked to Binance.
Found a mistake in the text? Select it and press CTRL+ENTER
Cryplogger Newsletters: Keep your finger on the pulse of the bitcoin industry!