Refinitiv Newscasts - Binance mixed customer, company monies: sources

Silvergate Capital

23/05/2023 15:43

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Source: Reuters

Description: The world's largest cryptocurrency exchange, Binance, commingled
customer funds with company revenue in 2020 and 2021, in breach of U.S.
financial rules that require customer money to be kept separate, three sources
familiar with the matter told Reuters. Julian Satterthwaite reports.
Short Link: https://refini.tv/3MTcrfy

Video Transcript:

Binance mixed company money with customer deposits. That’s according to
three Reuters sources familiar with operations at the world’s largest
cryptocurrency exchange. One said the mixing ran into billions of dollars, and
happened almost daily. Reuters wasn’t able to confirm those numbers, but
did see bank records appearing to show the commingling of money. If confirmed,
that would be in violation of US rules which require customer deposits to be
kept separate. Three former Washington regulators say it would also be
evidence of lax internal controls, and could put client funds at risk by
obscuring their whereabouts. In a statement, Binance denied using any such
practices. It said there was no commingling at any time. Reuters found no
evidence that client funds were lost or stolen. However, the report will ring
alarm bells, after allegations of similar practices at collapsed crypto
exchange FTX. Its founder, Sam Bankman-Fried, has pleaded not guilty to fraud
charges, and denied there was any money mingling. The Binance funds in
question were held at the now-collapsed US lender Silvergate Bank. It
wouldn’t comment on the Reuters report