Binance management may have accessed Binance US's bank account and shifted funds, according to recent reports.
Binance CEO CZ had access to $400 million purportedly belonging to US consumers, which might be another blow for Binance.
May have had unauthorised access to a bank account belonging to Binance US and may have moved funds elsewhere.
Recent reports imply that CEO CZ of cryptocurrency exchange Binance had access to $400 million in money that were allegedly believed to belong to US users of the exchange, which could be yet another blow for Binance and CZ. Considering that the US Securities and Exchange Commission (SEC) is already tightening regulations around user asset custodian services, if this information is confirmed, it might be disastrous for Binance. The SEC recently restricted the BUSD stablecoin, and now there are suspicions of bank transfers from Binance US accounts.
Recent reports claim that executives at Binance had unauthorised access to a bank account held by Binance US, the exchange's autonomous U.S. subsidiary. According to the report, Binance transferred the specified sums to a trading company run by CZ. According to the Reuters story, these facts were made known due to access to business messages and banking information.
Additionally, it was reported that approximately $400 million was transferred to a trading company run by CZ, Merit Peak Ltd, once the transfers were started in late 2020. The transfers were made in the first quarter of 2021 from a Silvergate Bank account that belonged to the business that owned Binance US. It is unknown, though, if the funds belonged to Binance US clients or not. Additionally, given Binance also disclosed that Silvergate Bank is where its user money are kept, it is still unknown what prompted the transfer.
The SEC is proposing a new rule that would include cryptocurrency exchanges among the companies that hold user funds and bring them under its jurisdiction. The law could make it more difficult for crypto enterprises to survive in the nation by tightening regulatory procedures and harsher licencing restrictions.