Binance US has refuted reports drawing parallels between it and “fraudulent exchanges that went bankrupt.” The US-based cryptocurrency trading platform emphasized that “only Binance.US employees” have access to its bank accounts, denying the allegation that global cryptocurrency exchange Binance has “secret access”.
Binance US Clarifications
Binance US, a US-based cryptocurrency trading platform affiliated with global crypto exchange Binance, has refuted reports comparing it to fraudulent and bankrupt crypto exchanges. Binance and Binance US claim that they are separate entities with different management teams.
“There have been many attempts to draw parallels between Binance.US and fraudulent exchanges that have gone out of business,” the official Binance US Twitter account tweeted on Thursday. “There is no comparison,” the exchange emphasized, and proceeded to provide some evidence to back up his claims.
First of all, Binance US explained that its leadership is made up of former employees of the US Department of Justice (DOJ), the Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), and the Bank of the New York Federal Reserve. (Federal Reserve of New York). The exchange detailed:
Our leadership team includes former employees of the Department of Justice, the SEC, the FBI, and the New York Federal Reserve Bank who are committed to operating a platform that is secure and compliant with US laws and regulations.
Binance US then turned to the allegation, first published by Reuters, that Binance had “secret access to a bank account belonging to its allegedly independent US partner.” The post further alleged that during the first three months of 2021, more than $400 million flowed from Binance US’s bank account to Merit Peak Ltd., a trading company managed by Binance CEO Changpeng Zhao (CZ).
“While there was a market making company called Merit Peak that was operating on the Binance.US platform, it stopped all activity on the platform in 2021,” Binance US stated. “We list our competitive and transparent market maker program on our website, demonstrating that companies compete fairly for rebates.” The exchange insisted:
Only Binance US employees have access to Binance US bank accounts. Period.
In addition, Binance US assured the crypto community that it does not make use of client funds, a topic that is being closely scrutinized following the collapse of FTX, the exchange that allegedly commended client funds. Binance US emphasized:
Binance US has never exchanged or lent client funds, and never will. Binance US always maintains 1:1 reserves and is subject to regular audits and regulatory reporting by government entities.
The SEC recently took action against several companies in the cryptocurrency space, including Kraken for its staking program, Paxos for its issuance of the Binance USD (BUSD) stablecoin, and Terraform Labs for defrauding investors. Last week, SEC Chairman Gary Gensler proposed amending federal custody rules to cover all crypto assets.
What do you think about the clarifications provided by Binance US? Let us know in the comments section.
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