Top Reasons Why Binance is Not Next FTX!
Is Mazars’ decision to discontinue crypto auditing related to Binance’s insolvency? Mazars Group has stopped doing proof-of-reserves (POR) audits for cryptocurrency exchanges, and the recently published Binance POR has been deleted from the internet.
Prior to the FTX crash last month, Mazars was doing a number of POR audits for crypto exchanges such as Binance, Crypto.com, and Kucoin. However, an anonymous trader by the name of Da Viking has given a set of reasons for the Binance FUD.
“Mazars could have stopped *crypto audits* because they felt it was too risky for them, which is understandable in this climate. TradFi companies are increasingly wary of crypto since the FTX implosion. For example, banks have started banning accounts of crypto users.”
According to the anonymous trader, Mazars may have stopped crypto auditing because they deemed it too dangerous for them, which is logical given the current market conditions. Since the FTX collapse, traditional financial institutions have become increasingly skeptical about cryptocurrency.
On-chain data shows that Binance currently has more than $55 billion in reserves. As per data from CryptoQuant, Binance has processed OVER $14 billion in withdrawals this week alone! Approximately half of these withdrawals occurred on one day (December 13), although the bank still has $55 billion or more in reserves.
As indicated in this tweet by @ki young ju, on-chain data show the difference between FTX and Binance.
He stated that CZ’s reaction to the $2.1 billion on CNBC interview is about the money received by Binance in exchange for their FTX investment. It has nothing to do with user funds and does not signify a problem with withdrawals. Because Binance received both BUSD and FTT, and indicators imply that they did not liquidate their FTT, the amount clawed should be significantly less than $2.1 billion due to the FTT price drop.
“Finally, there’s FUD that #Binance has a reserves problem because it holds a lot of BUSD. BUSD is NOT issued by Binance. BUSD is issued by Paxos, backed by US dollars & T-bills, and approved AND regulated by the New York State Department of Financial Services (DFS).”