Binance.US refuted an earlier report by Reuters, which claimed that the international exchange allegedly moved $400 million from an account belonging to the US affiliate.
In an attempt to clarify the situation, Binance.US said that only executives on the platform had access to their bank accounts.
Binance allegedly transferred $400 million from Binance.US
A report published by Reuters on Thursday (February 16, 2023) claimed that bank records and company messages revealed that cryptocurrency exchange giant Binance transferred more than $400 million from a Binance.US bank account at Silvergate to a trading company called Merit Peak in the first quarter of 2021. According to the publication, the trading firm appointed CEO Changpeng Zhao, also known as “CZ”, as its manager.
However, Binance.US has issued a statement via a tweet stating that the report was incorrect and out of date without going into details. While the US affiliate acknowledged the existence of Merit Peak, the firm stated that the market maker ceased trading on the platform in 2021. The tweet further emphasized that only company executives could access their bank accounts, adding:
“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 firm also said that its leadership team is comprised of former employees of major US watchdogs including the SEC, the Department of Justice (DoJ), the Federal Reserve Bank of New York and the Office Federal Bureau of Investigation (FBI), who ensure United’s compliance. State laws and regulations.
Meanwhile, it appeared that the people in charge of affairs at Binance.US were unaware of the transfers, as indicated in the Reuters report, with messages revealing that the departures occurred without the knowledge of the executives.
ready to settle
Binance, which is not licensed to operate in the United States, has always claimed that Binance.US is an independent entity from the international platform. While the alleged transfers suggest a mix of funds, Reuters nevertheless stated that it could not determine if the money in question belonged to Binance.US clients.
Notably, Silvergate Bank has been in the news lately and is facing a regulatory investigation over its dealings with bankrupt crypto exchange FTX. Merit Peak was also reportedly under investigation in February 2022 by the Securities and Exchange Commission (SEC) for its ties to Binance.
Binance has also been under the radar of regulators in recent years, recently admitting failures in its regulatory compliance and is willing to settle with US regulators.
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