Binance Mixes Customer Funds with Corporate Funds: Reuters Report

Summary

• Reuters alleged Binance commingled customer funds with corporate funds in 2020 and 2021.
• Binance denied the allegations, claiming that the funds were always corporate funds.
• Reuters was unable to find evidence, of customers losing their funds due to Binance’s actions.

Background Information

Binance – the world’s largest crypto exchange – has once again hit the spotlight with Reuters claiming that the platform commingled customer funds and company revenue. The report claimed that the incident took place in 2020 and 2021, and the funds’ mix-up was in violation of the United States Financial rules. Additionally, it stated that this happened nearly every day with accounts associated with Silvergate Bank.

Binance’s Response

A Binance spokesperson denied any such commingling of customer and corporate funds; instead they argued that these were always corporate funds, which were sent for buying BUSD (Binance stablecoin issued by Paxos). Furthermore, Reuters also asserted that it could not find any proof of customers losing their money due to this action. Patrick Hillmann – Chief Communications Officer at Binance – spoke on this report via a Twitter post where he called it a “transparent attempt to protect themselves”.

Evidence Against Allegations?

The main allegation was based on one bank record dated 10 February 2021 which showed $20 million from a corporate account being mixed with $15 million from an account receiving customer money; however, there is no further evidence for this claim or reports of customers losing money as a result of Binance’s actions.

Conclusion

Despite Reuters‘ claims against Binance, there is no solid proof found for its main allegation or reports of customers losing their money as a result. Hence we can conclude that these are baseless accusations against one of the biggest crypto exchanges in existence today.