15 ms·
Binance is trying to calm investors, but its finances remain a mystery
- IG_Semmelweiss 4y agoArchive https://archive.vn/bwuu7 https://archive.vn/bwuu7
- bushbaba 4y agoBinance is even more shady than FTX. They are most likely not solvent. Personally, I'd move all my funds off binance to off-exchange wallets for the time being.
- anonymoushn 4y agoIt's difficult for anyone to be more shady than the people who stole ten billion dollars from their customers.
- JumpCrisscross 4y ago> difficult for anyone to be more shady than the people who stole ten billion dollars from their customers We literally don’t know where Binance is. It’s absolutely shadier than FTX, if a better-run scam.
- joosters 4y agoAnd we don't know who really owns it: "...Mr. Hillmann said he couldn’t provide the name of Binance’s ultimate parent company because Binance over the past year and a half has been in the process of a broad corporate reorganization." Even if Changpeng Zhao owns the majority of binance.com, the coins might be held by some other legally-distinct entity.
- jacquesm 4y agoGive it a few weeks to play out, at least before making that call.
- cstejerean 4y agoGiving it a few weeks to play out is how people end up without money once withdrawals are frozen. I'm not saying it would happen here, but in general I don't see any incentive to wait to find out and risk losing everything. Why not withdraw early and wait to see how it plays out while your money is safe?
- deleted 4y ago[deleted]
- elefanten 4y agoGp said give it a few weeks before declaring there’s no one shadier than FTX/Alameda
- vlovich123 4y agoI think that comment is in reference to “Binance is even more shady than FTX” rather than advice on how to manage your funds.
- anigbrowl 4y agoHold my Cristal
- hobofan 4y agoWhat about the exchange that potentially steals 70 billion (though I guess their own holdings of Binance token of 17 billion is possibly a more accurate estimate)?
- Panzer04 4y agoI guess we'll see if Binance manages to have an 11B balance sheet hole? ;P
- deleted 4y ago[deleted]
- ramraj07 4y agoJust makes one wonder why the binance guy even stirred the pot initially with FTX, like 3 possibilities exist: 1. He assumed the blowout would be minimal outside of FTX and/or assumed FTX was shady but not as bad as it turned out 2. He acknowledged the possibility that binance will also get scrutiny but realized FTX was just so bad that letting it fester further will only get him arrested faster too. 3. He’s just another idiot who made money lucky. Curious which it is.
- vgatherps 4y agoI mean fourth possibility is that binance is solvent right? I’m not assigning probabilities to any of them but taking their insolvency as a foregone conclusion seems pretty incorrect?
- iudqnolq 4y agoAssuming rational actors I can't see any reason to evade audits for years, even after litigation, unless the result of the audit would be bad.
- xvector 4y agoSee Tether. Crypto is just a massive house of cards that will collapse and drag the economy with it.
- WalterSear 4y agoIt's too small. It's entire, and arguably entirely fantastical market cap is still smaller than Apple.
- birracerveza 4y agoYeah, but it makes for a fantastic scapegoat.
- 4y ago
- sneak 4y agoFor the time being? Keeping your funds on an exchange (or in a bank) means they are, quite literally, not your funds. If you don't want the risk of loss, don't give your money to second parties.
- simiones 4y agoThat's true for an exchange, but is absolutely not true for a bank (in a well-run modern state). At least if you don't have millions+ of dollars in the bank, the state ensures that even if the bank were fraudulent, your money is still your money.
- novok 4y agoThey don't really for brokerage accounts, which is what most people's retirement savings actually are in.
- simiones 4y agoThe post I was replying to was saying "Keeping your funds on an exchange (or in a bank) means they are, quite literally, not your funds.". I was pointing out that it's absurd to compare unregulated crypto exchanges to proper banks (in a working state - I am sure banks in failed states can well be just as bad).
- sneak 4y agoYour statement is commonly believed, but is completely false. Money held in banks, at least in the USA, can be frozen or taken indefinitely by the state with no evidence of wrongdoing or even probable cause. There is a blog post on my website called "Your Money Isn't Yours" about the time Chase and the state of Indiana conspired to steal all of the money I had in the world without any basis or reason. Many people misunderstand this about property in the USA. Civil asset forfeiture among several other mechanisms means that property is guilty until proven innocent and can be stripped from you at any time without any evidence whatsoever. Money held in the bank in your account is literally not your money. It's the bank's money with a corresponding liability to you. They prove this quite plainly by loaning it out to other parties.
- bartvk 4y ago> They are most likely not solvent On what basis do you make this statement?
- woodruffw 4y agoFrom TFA: > The reserve report, released Wednesday, is a five-page letter from a partner at the South African affiliate of the global accounting firm Mazars. It contained three numbers. The letter wasn’t an audit report, didn’t address the effectiveness of the company’s internal financial-reporting controls, and said Mazars did “not express an opinion or an assurance conclusion,” meaning it wasn’t vouching for the numbers. > Mazars said it performed its work using “agreed-upon procedures” requested by Binance and that “we make no representation regarding the appropriateness” of the procedures. This sounds like a Binance paid for a brand name on an empty report, while providers of said brand name (Mazars) are doing everything in their power to distance themselves from factual claims about Binance's solvency. Am I missing something here?
- jsemrau 4y agoNope. That's pretty much the gist of the whole shenanigan. As a former CRO, it's not unheard of but quite uncommon to do this. Because normally it has the opposite effect. It should have been only audited financials. But the Big 4 have failed us spectacularly in recent years.
- siwatanejo 4y ago
- zoklet-enjoyer 4y agohttps://en.m.wikipedia.org/wiki/CRO https://en.m.wikipedia.org/wiki/CRO
- gomoboo 4y agoChief Risk Officer?: https://www.investopedia.com/terms/c/chief-risk-officer-cro.asp https://www.investopedia.com/terms/c/chief-risk-officer-cro....
- JumpCrisscross 4y ago> Am I missing something here? Nope. I can produce a similar report for 60x+ my net worth. Bank account snapshots, wire in wire out. Leveraged assets, debt ignored. This is all marketing aimed at the financially illiterate.
- xiphias2 4y agoEven if Binance is 100% solvent, big crypto money needs to be stored with multisig between multiple companies. I advise everyone to use casa hodl for storing btc and eth if they are afraid of doing it themselves.
- grugagag 4y agoEveryone seems to unison on keeping it off any exchange or any other unregulated scam. If Casa Hodl goes with your money you almost deserve it
- xiphias2 4y agohttps://keys.casa/ https://keys.casa/ What do you mean? A friend was asking me what should a friend of him do with a significant amount of BTC/ETH (tens of millions of dollars), as the owner died and there are 3 children who need to get it when they get 18. Lawyers are not capable of handling that much money without professional help, so I adviced them to go to a place when they help them with the self custody step by step with open source software.
- Geee 4y agoCasa is not a custodian. It's a multisig solution. https://keys.casa/how-it-works https://keys.casa/how-it-works
- monero-xmr 4y agoBinance is the closest thing to a global, borderless bank that exists today. They exist everywhere and nowhere. Their legal entities shift based on what is needed at the moment. They have the ability to easily create tens of millions of dollars as needed based on their BNB reserves, tight relationship with Tether, their ability to launch new token projects (i.e. unregulated securities offerings), and their stablecoin BUSD. They act as an investment bank - I know a prominent crypto entrepreneur that got loaned 8 figures after a text message to help finance an acquisition. I would say it’s quite likely they are fractional reserve but they are so absolutely huge it would take a lot more FUD than exists currently to damage them even a little. They have a lot of room to maneuver.
- clpm4j 4y agoThis absolutely screams red flags.
- ergocoder 4y ago> They have the ability to easily create tens of millions of dollars as needed based on their BNB reserves Sounds like a huge red flag.
- roland35 4y agoWoohoo magic mystery money! How did that work out for FTX with FTT?
- Gigachad 4y agoI was told crypto was the answer to central banks printing money. Ironically a tech friend predicted all this way way back at the start, I mentioned one of the advantages of bitcoin was the fixed amount and he replied "What stops your exchange from showing $1000 on the webpage but not actually holding that amount?" Exactly the problem unfolding years later.
- rippercushions 4y agoI hope you realize that while you're trying to argue that all of this is a good thing, it's actually making them sound worse-than-FTX levels of sketchy.
- drexlspivey 4y agoOnly Coinbase will survive at the end. It's the only one of the big exchanges that doesn't do any form of debt/lending/margin etc just straight up offering trading for a fee.
- anonymoushn 4y agoLMAX and Kraken are similar.
- rippercushions 4y agoIt's unlikely even Coinbase will survive: they lost $1.1 billion with a B in Q2 and $545M in Q3. Their trading fees are well known to be far higher than the competition (because they can't juice their numbers by gambling), so they rely on unsophisticated mass investors who don't know any better, but those investors are wisely staying the hell away from crypto right now.
- Mengkudulangsat 4y agoHow in the world is Coinbase losing THAT much money? Isn't the product mature and fully-featured already?
- stickfigure 4y agoI was wondering this myself and it looks like they were +$3B profitable in 2021? A wild ride but it doesn't necessarily sound fatal.
- xwdv 4y agoI’m waiting for Binance and Tether to collapse, and then we will know with certainty crypto’s best days are behind it, down to zero it goes. If you have assets on Binance I would not be complacent. Get them out.
- senectus1 4y agoTether falling is going to make FTX look like a hiccup.
- sgt101 4y agoHopefully everyone who is serious has moved everything that the have away from that hole.
- jusonchan81 4y agoWhat’s surprising is Tether seems to keep getting away with enquiries against them. Does anyone really believe that they have enough cash to cover all the Tether coins out there?
- whatshisface 4y agoAll of these scams are bad for cryptocurrency, its best days will be some time after they all collapse (if that ever happens, maybe they'll just make new scams forever.)
- Gigachad 4y agoI just can't see how crypto can recover tbh. What other technology spent ten years, produced basically nothing of value, is almost universally hated by the whole population and then came back to be something useful? It's not like quantum computing where we just don't know how to make it work. There are close to no technical problems, the core idea just doesn't work.
- jrm4 4y agoThe core idea does not work for many, if not most, of the things people have promised it can work for -- but that's very different from "doesn't work." I'd say it's still a pretty strong contender not for "cash in hand" but for a better "money in your mattress."
- outside1234 4y agoSpoiler: Its a fraud
- rchaud 4y agoOut of interest, to what address was the letter from the accountants addressed to? A PO box?
- throwawayftx 4y agoBinance is another fraudulent crypto company like any other in that space.
- fisherjeff 4y agoI feel like if I were a Binance investor and they came to me and said “Hey so everything is fine, just look at these three numbers I asked Mazars to write down. Also there are a ton of caveats but you get the idea,” I would immediately 100% panic. How does this reassure anyone?
- Hamuko 4y ago>How does this reassure anyone? By only saying "Hey, so everything is fine, just look at this fancy report with a fancy name on it" and assuming that they don't actually read it.
- fisherjeff 4y agoOrdinarily I'd say no that doesn't make sense - their investors are sophisticated and they have teams that dig into this sort of thing all day long. After FTX, I don't think that holds as much water anymore.
- vishnugupta 4y agoWhen questioned about liability CZ callously remarked that it’s a bit complicated to audit their liabilities but they didn’t have any, and that we should “ask around”. So we now have a new audit system, “audit by ask around”.
- dottrap 4y agoThis YouTuber (Sasha Yanshin) did a scrutiny of the errors or omissions made with the different wallet checks in the report. This is the most detailed tear down I've been able to find so far on the Internet. https://www.youtube.com/watch?v=42VnEndJ9mo https://www.youtube.com/watch?v=42VnEndJ9mo
- rippercushions 4y agoThis is worth the watch. TL;DR: the non-audit a) doesn't cover Binance's notional holdings of $40B+ in stablecoins at all, b) doesn't match the list of wallets they've previously published, and c) there are shenanigans like billions in BTC teleporting into wallets right before the attestation date and teleporting right out afterwards.
- jmull 4y agoI personally wouldn't transfer a dime into Binance, but demonstrating the ability to perform a transaction of a specific time, place, and amount isn't shenanigans.
- anyfactor 4y agoEven though I would like to casually watch a video on Binance but I am going to pass on that channel. That channel is defined by red backgrounds, down arrows and fire. I firmly believe that one should be open to every opinion as long as they have a built a good framework aka BS detector. I feel like this video is not going to be a casual watch for me and I am definitely not invested in Binance that much to fact check everything presented on that video.
- RONROC 4y ago
- sumtechguy 4y agoThat is an unfortunate side effect of the way YT is running its feed system and ad revenue sharing. A good amount of YT vid thumbnails have turned into clickbait.
- alpark3 4y agoIf Binance is insolvent(which looks like the popular sentiment here), could it be possible that they're playing an angle to "fix" the solvency given enough time delay? Or does their insolvency practically guarantee that they will never be solvent again? Obviously the answer depends on the amount of financial trouble they're in, or whether they're in trouble at all. I'm not sure about anything else though.
- Zanfa 4y agoI'd bet on Binance just delaying the inevitable collapse, rather than trying to fix the underlying issues. Judging from the FTX balance sheet, they gambled all of their money on shitcoins and random projects without any sense of logic. No amount of fixing would have helped, other than an magical perpetual bull market. Odds are Binance is also fundamentally screwed.
- shapefrog 4y agoIF they never gambled their depositors money, then they are/will be fine. Running an exchange, taking a cut of all transactions on your platform is effectively impossible to collapse (excluding your actual costs of doing business).
- unmole 4y agoThey can even do proprietary trading using the market information they have!
- shapefrog 4y agoFor an unreglated market, it really is a licence to print money - the one and only thing you have to do is keep your depositors assets stored in the asset they have deposited or exchanged to.
- cuteboy19 4y agoWhat do you mean by can? Frontrunning client trades is standard crypto exchange practice
- LatteLazy 4y agoBinance was partly responsible (rightly or not) for triggering FTXs collapse. Edit: Triggered, not caused. He controlled the timing. Doing so without having their own house in order would be suicidal. I'm not saying they are safe. Just that CZ is either much happier he can deal with a "bank run" or crazy. Does anyone know why it is so difficult for companies to provide audits? It seems like it SHOULD be very doable for them to get PWC or similar in, show them all the deposits and all the assets, do some spot checks on individual accounts, and get a meaningful bill of health?
- isitmadeofglass 4y agoThe only way for them not to trigger the FTX crash’s at the point they did, would have been to absorb 8 billion $ worth of missing funds and handing over control of a much larger set of funds to the people responsible for those losses. They weren’t partly responsible for FTXs crash for looking at that balance sheet and going wtf, we’re out. Even if they themselves are running the same scam. They might just be much less under water and trying to keep their head above it, until the goldfish forget about the FTX crash.
- LatteLazy 4y agoI am not sure I follow your logic. CZ and Coindesk triggered (not caused, but triggered) the collapse by announcing they thought there was an issue. CZ could have avoided that without giving FTX any money by just not doing it: quietly selling Binances FTT. I do't blame CZ for the problems at FTX. I am just saying, if you trigger a (justified) bank run in a competitor, you have to expect people to withdrawn from your own org too. So triggering it and NOT being solvent yourself is inviting disaster...
- hiq 4y ago> quietly selling Binances FTT I don't think this was possible. This would have crashed FTT anyway, so people would have looked at it and found out that Binance was behind this. If Binance hadn't communicated about this beforehand, it would have made them look even shadier.
- seanhunter 4y agoOne thing to be aware of with Binance. As far as I understand, most of the transactions occur on their own ethereum-compatible-but-not-quite-ethereum chain called the "Binance Smart Chain". While having these sidechains can improve scalability and reduce costs (they are just another form of sharding), this presumably introduces an additional point of potential failure compared with regular centralised exchanges: not only can the exchange fail to honour withdrawals, but the bridge between the chains could also fail to honour transfers out from the Binance smart chain back to the ethereum mainnet. There is also an additional potential point of misaccounting/fraud and also theft. What's supposed to happen with bridges is say I want to move some token from the mainnet to BSC, I send the token to the bridge on mainnet and it issues me the token on the BSC side. However, mainnet doesn't know anything about the existance of BSC so the token on the mainnet side still exists and is still a valid token on the mainnet. Likewise when I move stuff from BSC to mainnet the same thing happens - a residual token is created out of thin air on the side which the "real" asset is leaving. Now good actors should burn this token (move it to an address that noone has the private key to so it is put permanently beyond use) to make it go away but there is a lot of temptation to not do this because if you mess up or something otherwise goes wrong there is no going back. You can't "unburn" things. So rather than burning, people often put stuff into a special holding address and sort of triple pixie promise they won't double-spend it. This can also help legitimately reduce cost because next time you need to create the token on this side of the bridge you can instead take one out of this store and use that instead. You can see the problem presumably? If someone bad (either internally or via a hack) gets access to the keys to this address their motives might not be pure and suddenly they have a large amount of seemingly valid assets they can just take. This is part of what happened with the "Ronin" hack of Axie Infinity - they managed to phish a private key of the bridge and steal assets that had been bridged between networks. https://edition.cnn.com/2022/03/29/tech/axie-infinity-ronin-hack/index.html https://edition.cnn.com/2022/03/29/tech/axie-infinity-ronin-...
- pavlov 4y agoHow is this kind of sidechain any better than just having your transactions recorded in a boring old private SQL database? The Axie Infinity hack suggests that these private chains are the worst of all worlds: they're effectively controlled by a single entity, but also far more susceptible to hacks than a well-understood traditional database. The blockchain part seems to be a pure marketing decoy that's worse than useless because it's actively harmful to customers.
- tibbydudeza 4y agoSouth African affiliate - oh dear - let's just the accounting profession in South Africa is generally found to be wanting after several scandals they missed out on or were complicit in.
- rawoke083600 4y agoCompared to say USA ?
- tibbydudeza 4y agoEnron is about the only one I heard of out of the US - here we had several big-name corporate failures and the lead auditor partner who were complicit in one major banking fraud case (he got "loans" from the bank like the FTX CEO who loaned him and others billions) KPMG is being sued for R863m for that one - it seems the quality of work, oversight and ethics of some are severely lacking in these firms.
- tibbydudeza 4y agohttps://gizmodo.com/binance-crypto-ftx-withdrawals-stablecoin-1849887201 https://gizmodo.com/binance-crypto-ftx-withdrawals-stablecoi... So much for preventing this.
- tibbydudeza 4y agoBinance is that not much different from Alameda and FTX.
- spaceman_2020 4y agoThe Binance bank run has already started within my crypto circle.
- SkyMarshal 4y agoThere are three ways to make a living in this business - be first, be smarter, or cheat. Now I don't cheat. And although I like to think we have some pretty smart people in this building, it sure is a hell of lot easier to just be first.
- obert 4y agoBinance is a scam. They make it extremely hard to withdraw money, with errors, fake limits, unresponsive customer support.
- davidkuennen 4y agoInteresting, did this change recently? I remember cashing out almost 6 figures EUR around the peak last year without any problem. Since then I stayed away from the crypto market.
- obert 4y agoI moved away too, this happened while I was closing all my wallets across multiple plats
- bartvk 4y ago> They make it extremely hard to withdraw money, with errors, fake limits, unresponsive customer support. What is the reason you say so? Meaning, is that your personal experience? What amount of money are we talking about, and why was the limit "fake"?
- obert 4y agopersonal experience, few bucks fortunately, lost and I’m giving up on it
- Tenoke 4y ago>They make it extremely hard to withdraw money This might be true for Binance.us (seperate, smaller entity), I don't know but definitely isn't true for actual Binance. A few chains have occasional to frequent ~1 day deposit/withdrawal pauses but waiting a day isn't the same as it being extremely hard (and even in those cases you can convert to something else and withdraw that).
- voyager1 4y agoIt amazes me how confident the comments against and in favor of crypto/Binance are. It is very likely that you don't have appropriate knowledge or don't have access to critical information as to why something is the way it is. The youtube link posted below is supposedly revealing irregularities with the audit, but the basic knowledge of how the blockchains work invalidates the irregularities. The claim is that the audit is missing a bunch of wallets and coins, but they don't understand that BSC, ETH and BTC wallets also hold other coins, not just BNB, ETH and BTC (e.g. ETH and BSC wallets can hold basically any coin and even BTC wallet can actually hold USDT/TETHER). Unless you work at Binance and have access to all the financials, your guess is basically a coin flip wether they are solvent or not. As an example, a few weeks ago crypto.com was said to be insolvent and there was a bank run [1] [2], however nothing collapsed. As always, be cautios, not your keys, not your coins, but I would definitely not bet (short) that they would collapse. “It ain’t what you don’t know that gets you into trouble. It’s what you know for sure that just ain’t so. “ – Mark Twain For fellow technological enthusiasts, an interesting innovation from Binance: they generated the merkle tree where any Binance user can independently self verify his assets within the platform [3]. [1] https://news.ycombinator.com/item?id=33590579 https://news.ycombinator.com/item?id=33590579 [2] https://twitter.com/marionawfal/status/1591803227003129858 https://twitter.com/marionawfal/status/1591803227003129858 [3] https://www.binance.com/en/proof-of-reserves https://www.binance.com/en/proof-of-reserves
- flakeoil 4y ago"Unless you work at Binance and have access to all the financials, your guess is basically a coin flip wether they are solvent or not." This is one of the reason why Binance should be regulated properly or closed down.
- Cipater 4y agoWhat say you to Jesse Powell's questions about Binance's proof of reserves? https://twitter.com/jespow/status/1600787933065117696 https://twitter.com/jespow/status/1600787933065117696
- ceejayoz 4y ago> As an example, a few weeks ago crypto.com was said to be insolvent and there was a bank run [1] [2], however nothing collapsed. Partly because they “oppose-daisied” $400M of their holdings with a misclick. Not confidence inspiring. https://www.bloomberg.com/news/articles/2022-11-13/crypto-com-recovers-400-million-after-misplaced-ether-eth-transfer https://www.bloomberg.com/news/articles/2022-11-13/crypto-co... Not collapsing could mean solvency, but it could also just mean the run wasn’t big enough.
- ainiriand 4y agoWouldn't be better to ask for a proper audit from one of the big 4 (EY, PWC, KPMG, Deloitte), instead of something that looks fishy? Edit: typo.
- deleted 4y ago[deleted]
- jwmoz 4y agoIt's only a matter of time https://www.forbes.com/sites/michaeldelcastillo/2020/10/29/leaked-tai-chi-document-reveals-binances-elaborate-scheme-to-evade-bitcoin-regulators/ https://www.forbes.com/sites/michaeldelcastillo/2020/10/29/l...
- revskill 4y agoNo need to calm, as Binance is well trusted by everyone.
- mothsonasloth 4y agoFundus are SAFU https://www.youtube.com/watch?v=DelF6zEHXpE https://www.youtube.com/watch?v=DelF6zEHXpE
- nova22033 4y agohttps://www.reuters.com/markets/us/us-justice-dept-is-split-over-charging-binance-crypto-world-falters-sources-2022-12-12/ https://www.reuters.com/markets/us/us-justice-dept-is-split-... WASHINGTON, Dec 12 (Reuters) - Splits between U.S. Department of Justice prosecutors are delaying the conclusion of a long-running criminal investigation into the world's largest cryptocurrency exchange Binance, four people familiar with the matter have told Reuters. The investigation began in 2018 and is focused on Binance's compliance with U.S. anti-money laundering laws and sanctions, these people said. Some of the at least half dozen federal prosecutors involved in the case believe the evidence already gathered justifies moving aggressively against the exchange and filing criminal charges against individual executives including founder Changpeng Zhao, said two of the sources. Others have argued taking time to review more evidence, the sources said.
- tibbydudeza 4y agoOh dear - house of cards.
- tim333 4y agoArthur Hayes of Bitmex pleaded guilty to "willfully failed to implement an anti-money laundering (AML) program at the exchange." He got six months of home confinement and Bitmex is going strong. Not sure the house of cards thing will happen.
- tibbydudeza 4y agoSBF got arrested - he is going to be made an example of by the DOJ - the poster child of all that is wrong with crypto.
- tibbydudeza 4y agohttps://gizmodo.com/binance-crypto-ftx-withdrawals-stablecoin-1849887201 https://gizmodo.com/binance-crypto-ftx-withdrawals-stablecoi... Oh dear - so it begins.
- hef19898 4y ago
- xbar 4y agoBut CZ seems like such a straight shooter.
- bananapub 4y agothey're of course not actually trying to calm investors - if they wanted to do that, they would just publish an actual audit report of a snapshot of their finances. instead, they want investors to feel calm and leave them alone to their elaborate deceptions.
- firstSpeaker 4y agoSurprising that this is not the front page. FTX related news are still front page but this is in the obscurity. Any of these two YC funded?
- tim333 4y agoNah not YC funded. The Binance stuff is basically rumours hence not that high ranked.