The details come amid an increase in FUD targeting Binance over the past two days.
It is said that Binance Labs – the investment arm of the crypto exchange Binance – has achieved a historic return on investment, reaching up to 2,100%. As a result, total assets under management reached $7.5 billion, according to the latest blog.
The platform reassured employees that its “financial situation is very good” and added that it has enough cash reserves to cover daily operations in a difficult climate.
Binance Breaks Silence
Binance has said that everything the user deposits on the platform is supported 1:1.
In addition, customers also have the right to withdraw coins at any time, thus quashing rumors that are enough to make people work can do that. Taking into account FTX, whose creators have been accused of misappropriating users’ funds, Binance said it will not destroy those assets for trading or investing. The change made it clear that there was no debt, or that it was not on the list of creditors of the company that failed recently.
“A few bad cases do not represent the whole industry. Many people have begun to doubt and attack the hidden industry as a whole from a few bad cases, which shows that the development of the entire industry still has a long way to go.”
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The Paradox of Reservations
Due to the failure of FTX, the crypto industry’s latest initiative is to make proof of deposit. As such, Binance has launched a Merkle tree-based system for Bitcoin and Ethereum. Other platforms such as OKX, Crypto.com and ByBit have taken a similar approach amid growing calls from investors seeking insight from central exchanges around the world.
Global auditing firm Mazars has confirmed that Binance has enough Bitcoin and Wrapped Bitcoin (WBTC) to cover all client balances on the platform as of November 22. However, many experts at home service pointed out that the report did not deal with the security mentioned but focused on informing the public about the protected assets. CoinLedger CEO and co-founder David Kemmerer told CryptoPotato,
“I believe that the exec at Binance has not been clear on its PoR and is doing more harm than good. Binance. Also, Binance cannot display the published PoR without the help of third parties. The company should engage an independent auditor to do this.
The crisis worsened when Mazars took down a website that promoted proof of security services for crypto exchanges. His decision to quit doesn’t mean the reports are wrong. It may mean that the research firm does not want the risk of working on a security report from a crypto exchange, especially after the highly publicized failure of FTX.
Nevertheless, an on-chain analysis of Binance by blockchain analytics firm CryptoQuant concluded that Bitcoin deposits and other major currencies on the platform “do not show ‘FTX-like’ behavior at this time.” After further research, CryptoQuant revealed that it compared Binance’s Bitcoin fees, as shown in the evidence of the security report, to the amount of BTC data on the chain held by the exchange.
