Binance, the world’s largest cryptocurrency exchange, has strongly refuted a recent Reuters report claiming that the company commingled customer funds with company revenue during 2020 and 2021. In a response from Binance’s Chief Communications Officer Patrick Hillmann, the report was described as “weak” and accused Reuters of relying on unsubstantiated claims.
Hillmann took to Twitter to express his disagreement with the article, stating, “This story is so weak that they had to put up a front, ‘Reuters found no evidence that Binance client monies were lost or taken’ in a transparent attempt to protect themselves from a libel suit.” He further criticized the report for relying on conspiracy theories without concrete evidence other than the testimony of an anonymous “former insider.”
The Reuters report had alleged that Binance commingled customer funds with company revenue, citing sources familiar with the situation. It specifically mentioned a bank record that purportedly showed a mix of $20 million from a corporate account with $15 million from an account that received customer money on February 10, 2021.
While Reuters did not immediately respond to requests for comment, Binance has been embroiled in regulatory challenges. In March, the US Commodity Futures Trading Commission (CFTC) accused Binance of allowing US-based trading firms to trade cryptocurrency derivatives on Binance’s international exchange.
The CFTC complaint also mentioned the commingling of funds by some of Binance’s entities. It alleged that CEO Changpeng Zhao instructed employees and customers to bypass compliance controls to maximize corporate profits.
Additionally, the CFTC lawsuit claimed that Binance had provided certain VIP clients with preferential treatment through faster trade execution. Changpeng Zhao, also known as CZ, expressed his surprise and disappointment regarding the CFTC complaint, stating, “Upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged in the complaint.”
The ongoing disputes between Binance and regulatory bodies and the recent allegations of fund commingling have generated significant attention within the cryptocurrency industry. The outcome of these legal battles will likely have far-reaching implications for Binance and the broader cryptocurrency ecosystem.
