The latest news regarding the exchange platform Binance is not causing too many smiles. According to the Reuters report, it appears that the platform’s former Chief Financial Officer, Wei Zhou, did not have access to the company’s full corporate accounts during his three-year tenure.
The news is reported on Bitcoin Archive’s official Twitter account, which reads:
BINANCE
– Ex-CFO did not have access to full company accounts during 3-year tenure – Reuters
— Bitcoin Archive (@BTC_Archive) December 20, 2022
Reuters report on the latest news about Binance
Binance‘s former Chief Financial Officer Wei Zhou did not have access to the company’s full financial accounts during his nearly three-year tenure, Reuters reported, citing two people who worked with him.
Specifically, Zhou, who left Binance in 2021, did not immediately respond to Insider’s request for comment. The report also follows promises by Binance CEO Changpeng Zhao that the company will lead by example in embracing transparency after the fall of competitor FTX, the $32 billion former crypto empire started by Sam Bankman-Fried.
Binance.com, which has processed more than $22 trillion worth of transactions this year, has financial data that is more like a black box and mostly hidden from public view, as per a Reuters analysis of the company’s corporate documents.
Indeed, Reuters reviewed the records of Binance entities in more than a dozen jurisdictions where the exchange claims to have “regulatory licenses, registrations, authorizations and approvals,” which include locations such as states in the European Union, Canada and Dubai.
Specifically, the report reads the following:
“The documents show that these units appear to have sent little information about Binance’s activity to the authorities. For example, public filings do not show how much money flows between the units and the main exchange Binance.com. Reuters analysis also found that many of the units appear to have little activity.”
Binance’s response on the issue of the former CFO and financial accounts
Following the attack, Binance’s Chief Strategy Officer Patrick Hillmann said the analysis of the documents was categorically false. Claiming in a statement to Reuters the following:
“The amount of corporate and financial information that must be disclosed to regulators in those markets is immense, often requiring a six-month disclosure process. We are a privately held company and are not required to disclose our business finances.”
To be more precise, Binance is not required to publish detailed financial statements, as, for example, its Nasdaq-listed competitor Coinbase must do.
Hence, Binance does not disclose basic information, such as where Binance.com is located, because it is not required to do so.
The company also does not report revenue, profits, or cash reserves. Binance has its own token, called BNB, but has not yet revealed what role the coin plays in its balance sheet.
In any case, the CZ-led platform posted a “snapshot” of its holdings of six major tokens on its Web site last month and released proof of reserves earlier this month, although critics have stated that such information is incomplete and may be misleading.
Other news: latest investigation against exchange Binance
Continuing to analyze the recent Reuters report, one can read:
“It lends money to clients against their crypto assets and allows them to trade on margin, with borrowed funds. But it doesn’t detail how big those bets are, how much Binance is exposed to that risk, or the full size of its reserves to fund withdrawals.”
However, Binance did not immediately respond to Insider’s request for comment on the matter. Now, the US Department of Justice is investigating Binance for its potential conspiracy for the purposes of money laundering, transmitting money without a license, and violating criminal penalties, according to Reuters.
In addition, sources also say that Binance has processed more than $10 billion in illegal payments this year. Be that as it may, a Binance spokesperson told Insider that it would be inappropriate for them to comment on DOJ-related matters.
