According to Bloomberg, the funds were stored in a wallet called “Binance 8” – the amount of assets at this address significantly exceeds the amount needed to support the 94 tokens issued by the exchange.. These are wrapped tokens on the Binance Smart Chain and Binance Chain networks.
The wallet currently contains 1.44 million ETH coins worth over $2.3 billion, as well as various tokens worth over $10 billion. This is the company’s cold wallet and should not have assets to back Binance’s native tokens.
Collateral assets were mistakenly moved to a Binance 8 cold wallet. At the same time, everything is calculated correctly on the reserve confirmation page for our tokens. We are aware of the error and are in the process of transferring collateral funds to special wallets dedicated specifically to storing collateral,” a Binance spokesperson told the publication.
Binance Wallet 8 holds collateral for more than 40 tokens on Binance networks, according to analysts.. The total amount of collateral assets was $539 million.
In traditional financial institutions, it is strictly forbidden to keep collateral in the same accounts as user deposits. It is also considered a flagrant violation of the rules of most regulators.
It was recently reported that some users of the Binance exchange from Russia faced account blocking.