{"id":71342,"date":"2022-12-12T16:57:58","date_gmt":"2022-12-12T14:57:58","guid":{"rendered":"https:\/\/forklog.com\/en\/?p=71342"},"modified":"2025-09-08T08:09:17","modified_gmt":"2025-09-08T05:09:17","slug":"experts-warn-of-alarming-signals-in-mazars-report-on-binance-reserves","status":"publish","type":"post","link":"https:\/\/forklog.com\/en\/experts-warn-of-alarming-signals-in-mazars-report-on-binance-reserves\/","title":{"rendered":"Experts warn of alarming signals in Mazars report on Binance reserves"},"content":{"rendered":"

Mazars’ audit of Binance’s bitcoin reserves did not convince experts that user assets on the platform were safe, according to The Wall Street Journal<\/a>.<\/p>\n

On December 7 the company published a letter<\/a> with the audit results. It concerned the platform’s liabilities and their collateralisation in the first cryptocurrency. It also considered wrapped coins<\/a> in the Ethereum, BNB Chain and BNB Smart Chain networks. The assets of the U.S. subsidiary were not covered by the audit.<\/p>\n

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\u201cIt is important for us to show users that the treasury is not empty, as with FTX,\u201d said Binance’s director of strategy Patrick Hillmann.<\/p>\n<\/blockquote>\n

A former member of the Financial Accounting Standards Board and investment manager Hal Schroeder said the Mazars report does not provide a view on the quality of the exchange’s internal controls, including the accuracy of accounting.<\/p>\n

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\u201cWe do not know how good Binance’s systems are for liquidating assets to cover any margin loans. And remember that in the United States, even with good mechanisms, banks have sometimes been caught off guard. In light of what we have seen in the Bahamas, I do not want to conclude that everything is fine,\u201d added the expert.<\/p>\n<\/blockquote>\n

Sources also pointed to the lack of transparency in the corporate structure, which Hillmann said has been under restructuring for two years.<\/p>\n

Mazars’ letter was addressed to Binance Capital Management, registered in the British Virgin Islands. However, the exchange’s top management could not confirm that this structure is the parent and controls the assets.<\/p>\n

Baruch College professor and former chief auditor PCAOB<\/span> Douglas Carmichael noted that the document \u201cdoes not answer all investors’ questions about the sufficiency of the collateral.\u201d<\/p>\n

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\u201cThat seems to be the main point it is making,\u201d added the expert.<\/p>\n<\/blockquote>\n

Hillmann, in the course of the interview, repeatedly described Mazars’ review as an audit. Carmichael regarded the use of that term in this context as \u201ca gross distortion.\u201d<\/p>\n

Mazars, in the letter, cites three figures:<\/p>\n