Binance denies Reuters report that it commingled customer and corporate funds

The cryptocurrency exchange Binance has rejected Reuters’ report asserting that user funds were commingled with corporate revenues in 2020 and 2021, in материале Reuters.

Let me explain just how desperate a journalist @Reuters is to publish a negative story. The whole base of their story this morning, is that when users purchased BUSD (Paxos) from Binance, they were taken to a transaction page that had the term “deposit” on it. Users were making a…

— Patrick Hillmann (@PRHillmann) May 23, 2023

Patrik Hillmann, the company’s chief strategy officer, said that Reuters journalists were desperate to publish a “bad story” that turned out “weak”.

“Then they crammed 1,000 words of conspiracy theories (which, as we explained, were false) with zero evidence, besides an ‘ex-insider’ […]. We were very public about the company’s past regulatory shortcomings,” the senior executive wrote.

In a subsequent tweet, Hillmann wrote that Binance keeps “user and corporate funds in completely different ledgers”.

“The agency studied a bank record indicating that on February 10, 2021, Binance mixed $20 million from the corporate account with $15 million from the account that held customer funds,” the article states.

A Binance spokesperson, Brad Jaffe, told Reuters that the Silvergate Bank accounts were not used to accept deposits from traders — only “to facilitate users’ purchases of cryptocurrencies”.

“There has never been any commingling, because these are 100% corporate funds,” he noted.

In March 2023, the CFTC filed a lawsuit against the cryptocurrency exchange Binance and its CEO Changpeng Zhao. The agency contends that the platform traded derivatives in violation of rules, operating without the proper registration.

Within roughly a week after the CFTC’s allegations, Binance’s share of the spot market fell from 70% to 54%.

In February, NYDFS began an investigation into Paxos—the issuer of the BUSD stablecoin linked to Binance.