Binance CEO Slams Forbes for Spreading False Information Intentionally
CZ slams Binance for moving assets like FTX and disseminating false information
Forbes attacked the world’s largest cryptocurrency exchange Binance for alleged misconduct in handling customer funds. Binance transferred US$1.8 billion in collateral to hedge funds such as Alameda and Cumberland/DRW last year to back their customers’ stablecoins.
The problem does not revolve around Binance pegged, but B-peg USDC. An examination of blockchain data from August 17 to early December revealed that there was no collateral for the B-peg stablecoin, despite the exchange’s claim that it was fully backed. Customer funds intended to back USDC digital replicas could have thus been used to fund other trades, similar to FTX.
CZ mentioned Tron, Amber Group, Alameda Research, and other companies mentioned by Forbes, but he doesn’t seem to understand the fundamentals of how an exchange works. “Our users can withdraw their assets whenever they want. Their withdrawals resulted in the receipt of hundreds of millions of dollars in collateral.” According to the CEO, the article ignores the fact that users must first deposit funds with Binance before making uninvestigated withdrawals.
Furthermore, Binance’s CEO emphasized that the exchange has implemented a proof of reserves protocol using the new Zero Knowledge (ZK) approach proposed by Ethereum co-founder Vitalik Buterin, which protects user security and privacy.
The Forbes article comes after the largest cryptocurrency exchange in the United States, Coinbase, announced yesterday that it will no longer trade the stablecoin BUSD. The Paxos stablecoin was withdrawn after the Securities and Exchange Commission (SEC) issued a Wells Notice against its issuer, but it can still be redeemed until February 2024.
At the time of publication, BNB was trading at US$301.68, still trading above the 200-day Exponential Moving Average (EMA).
After informing the traders, the crypto exchange was forced to close the positions to comply with Australian regulations. Across social media platforms, the decision has stirred debate and controversy. A user using a pseudonym shared a screenshot of the official message sent by Binance to Australian traders whose positions had been liquidated or “nuke.
” As shown in the image below, the crypto exchange closed the positions and accounts of the incorrectly labeled users. Traders can still use the platform to buy and sell cryptocurrency on the spot market.