Binance Responds to Forbes Article on Misappropriation of Customer Collateral

Binance has issued a response to an article published by Forbes, which alleged that the exchange had misappropriated $1.8 billion of customer collateral.

“When you are the world’s largest crypto exchange in a virtually unregulated market, you can change the rules of the game as you see fit.. In a behind-the-scenes maneuver, Binance handed over $1.8 billion in stablecoin collateral to Tron founder Justin Sun, Amber Group, Alameda Research, and Cumberland DRW, leaving investors completely exposed.. They did it without informing their customers. The shuffling of Binance’s assets is eerily similar to FTX’s pre-bankruptcy maneuvers.

According to the Forbes investigation, Binance transferred the funds to other undisclosed purposes, without informing customers.

The exchange categorically denies the allegations, stating that the transactions are part of internal billing processes and do not affect users’ assets. Binance assures all interested parties that the movement of capital between wallets is normal, and the exchange never mixes its assets with client funds.

The B-peg USDC tokens, which the funds were intended to support, are digital copies of USDC stablecoins from Circle Financial, and all are backed by 100% collateral, Binance claims.

The exchange’s CEO, Changpeng Zhao, says that Forbes has tarnished the reputation of the exchange, and that the journalists don’t understand the basics of how the exchange works. In 2020, Forbes alleged that Binance had developed a strategy to evade US regulators, and the exchange sued the publication, but later dropped the lawsuit.