Binance's Alleged Crypto Audit Failed, Its Auditor Refused to Vouch For It

[franky1]

if you are a trader in binance, then make sure you are taking care of your funds. by the way, binance has SAFU in place, so i am more confident on this trading platform than others. so if anything goes wrong, they have insurance for their users. if they are having problems with the audit team, i guess, they are already silently rectifying it before it blows up just like what ftx scenario.

id suggest you double check the SAFU
https://academy.binance.com/en/glossary/secure-asset-fund-for-users
its SAFU for BTC is just 16,277 coins although user balance is over 500k coins.

so this is why users wanted a proper proof of reserves because safu wouldnt cover all reserves.. its just an insurance incase one of their hot wallets(on server withdrawal pots of 0.X% of reserves) got hacked. not an amount to cover the reserves should the reserves disapear in full

[DrBeer]

A few questions about Binance:
1. Do you store assets on this exchange?
2. How big are they? You can not answer with numbers, at least at the level - significant for me / not significant
3. After the news about potential problems appeared - did you withdraw your assets from the exchange? If not, why do you trust Binance?

[Poker Player]

CryptoQuant's Audit of Binance Reveals No 'FTX-Like' Behavior in Proof-of-Reserves

Binance Audited PoR Matches On-chain Data by 99% Says CryptoQuant

I would say that this case is not like FTX, and, moreover, I believe that the market is understanding it that way. With the FUD out there, if the big investors saw a parallel, the price would have dropped significantly by now.

It is normal that with everything that has happened this year, people are on the lookout, but this does not seem to be a case of accounting manipulation. I hope I am not wrong for everyone's sake.

[alexandr1115]

I don't quite understand what is the benefit of this audit?? Or what advantage does this audit give?? Similarly, it is possible to verify a transaction through the blockchain, but simply, what changes from this? II asked in one topic, but no one could clearly explain what exactly this audit gives. If it is not a blockchain, then it means that this audit is centralized, and what is the use of it?

The purpose of audit is to see if Binance is reporting the correct numbers and if there’s irregularities most probably that could affect the financial capability of Binance. Anyway, so many fud recently about Binance and its hard to believe on those especially after the statement of Binance that they can accomodate 100% withdrawals and still able to function properly, that’s how confident Binance is so its not easy to ruin Binance with those fud.

The most reliable way to check this is through the blockchain! Audit is not a blockchain, and then why is it needed?? That's why I ask, what is its advantage compared to blockchain??

[SirLancelot]

The purpose of audit is to see if Binance is reporting the correct numbers and if there’s irregularities most probably that could affect the financial capability of Binance. Anyway, so many fud recently about Binance and its hard to believe on those especially after the statement of Binance that they can accomodate 100% withdrawals and still able to function properly, that’s how confident Binance is so its not easy to ruin Binance with those fud.

if you are a trader in binance, then make sure you are taking care of your funds. by the way, binance has SAFU in place, so i am more confident on this trading platform than others. so if anything goes wrong, they have insurance for their users. if they are having problems with the audit team, i guess, they are already silently rectifying it before it blows up just like what ftx scenario.

I think you shouldn't worry about the traders because I am sure that once they are done trading, they will then withdraw most of their money. Traders are wise guys. If there's one that you should worry with then that must be the investors because they may store their money inside a centralized exchange such as binance thinking it was safe because they also heard a lot of good feedback over the past years/months from this exchange and then some of them know about the SAFU thing that you are talking about there but other problems might still occur. This is why best way to HODL a crypto is only through a wallet that we personally control.

[alexandr1115]

I don't quite understand what is the benefit of this audit?? Or what advantage does this audit give?? Similarly, it is possible to verify a transaction through the blockchain, but simply, what changes from this? II asked in one topic, but no one could clearly explain what exactly this audit gives. If it is not a blockchain, then it means that this audit is centralized, and what is the use of it?

The purpose of audit is to see if Binance is reporting the correct numbers and if there’s irregularities most probably that could affect the financial capability of Binance. Anyway, so many fud recently about Binance and its hard to believe on those especially after the statement of Binance that they can accomodate 100% withdrawals and still able to function properly, that’s how confident Binance is so its not easy to ruin Binance with those fud.

Thank you for your opinion. You try to explain it, but unfortunately you can't explain why audit is so useful. So you can log into the blockchain and check exactly the same thing. Audit is not a blockchain, and it cannot give more accurate information than the blockchain itself.

[kro55]

A few questions about Binance:
1. Do you store assets on this exchange?
2. How big are they? You can not answer with numbers, at least at the level - significant for me / not significant
3. After the news about potential problems appeared - did you withdraw your assets from the exchange? If not, why do you trust Binance?

Currently, I'm just accumulating bitcoins, so I have no reason to store my assets on binance, but I still use binance for things like exchanges, and p2p transactions as needed.

I can tell you that binance is the biggest exchange in the market, and it is so big that Binance's trading volume is equal to 10 different exchanges combined. I'm not saying binance will never die, but if it crashes, we'll see bitcoin drop to $5k or less, and we'll experience a longer bearish season than ever. You can check out their assets and everything needed to prove how big it is at coingecko.

[WillyAp]

I for once don't like binance due to its sice.
 
Nevertheless its unnecesary to develop conspiracy theories.
Its not in the interest of Crypto to fud crypto supporting companies without hard proof.

[Davian144]

Thank you for your opinion. You try to explain it, but unfortunately you can't explain why audit is so useful. So you can log into the blockchain and check exactly the same thing. Audit is not a blockchain, and it cannot give more accurate information than the blockchain itself.

Yes, Audit is not a blockchain. Because Blockchain and Audit do not have a relationship in terms of definition and understanding, so the two need to be separated first so that it is easier for everyone to understand. And Quoted from The Economic Times, an audit is a bookkeeping check to a physical inspection to ensure a department within an organization or company has followed a documented recording system. _[reference]

[alexandr1115]

Thank you for your opinion. You try to explain it, but unfortunately you can't explain why audit is so useful. So you can log into the blockchain and check exactly the same thing. Audit is not a blockchain, and it cannot give more accurate information than the blockchain itself.

Yes, Audit is not a blockchain. Because Blockchain and Audit do not have a relationship in terms of definition and understanding, so the two need to be separated first so that it is easier for everyone to understand. And Quoted from The Economic Times, an audit is a bookkeeping check to a physical inspection to ensure a department within an organization or company has followed a documented recording system. _[reference]

You have written quite competently what this concept means in accounting, but, unfortunately, this does not answer an important question! Why should audit be used and why is it useful?? Everything you've written can be done in exactly the same way via blockchain. Just why use audit?? If you can do exactly the same thing on the blockchain. Don't you think that's weird?? It seems strange to me. You may also wonder how reliable the audit is in general and is it possible to change the record in the audit? It seems to me that it is possible to change the record in the audit! But you can't change an entry in the blockchain. If you ask yourself these questions, you will realize that blockchain can do exactly the same thing, but with greater reliability. Thank you for your attention!

[WillyAp]

Why should audit be used and why is it useful??

To disarm critics, nonbelievers, fudders. To create trust. Quite simple.

[mindrust]

Binance says an audit shows proof of reserves of customer funds. But its auditor will not vouch for the reserves nor the methodology demanded by Binance.

What do you think ?

1) Is Binance manipulating the crypto industry

2) Is Binance involved in any sort of money laundering

3) Is BNB being inflated at the cost of investors/traders money

4) What will be the fate of users if Binance in any case will be scrutinized and found to be a culprit


https://mishtalk.com/economics/binances-alleged-crypto-audit-failed-not-even-its-auditor-would-vouch-for-it

Binance is probably doing all of those things you mentioned to an extent. When an exchange becomes that big, it is very hard to stay "clean". More or less some fuckery will happen anyway.

But are these will be enough to send binance to bankruptcy? I can't be sure. It all depends on how corrupted they became.

If they went full Gox, then yes, binance don't have much time left.

[beerlover]

Thank you for your opinion. You try to explain it, but unfortunately you can't explain why audit is so useful. So you can log into the blockchain and check exactly the same thing. Audit is not a blockchain, and it cannot give more accurate information than the blockchain itself.

Yes, Audit is not a blockchain. Because Blockchain and Audit do not have a relationship in terms of definition and understanding, so the two need to be separated first so that it is easier for everyone to understand. And Quoted from The Economic Times, an audit is a bookkeeping check to a physical inspection to ensure a department within an organization or company has followed a documented recording system. _[reference]

The difference is that we can see how much binance has via blockchain and we know that they are definitely rich enough to cover all the deposits, meaning why would we care about some accounting firm and what they say about the audit?

The regular companies that have audits do not have blockchain along with them, so you have to trust the company that does the audit, but in this case it's different because Binance could simply show the blockchain and their wallets and you will see that they have the money for it. This difference means that audit and blockchain mean different things, and a company that has blockchain usage doesn't really need audit companies approval.

[TimeTeller]

Thank you for your opinion. You try to explain it, but unfortunately you can't explain why audit is so useful. So you can log into the blockchain and check exactly the same thing. Audit is not a blockchain, and it cannot give more accurate information than the blockchain itself.

Yes, Audit is not a blockchain. Because Blockchain and Audit do not have a relationship in terms of definition and understanding, so the two need to be separated first so that it is easier for everyone to understand. And Quoted from The Economic Times, an audit is a bookkeeping check to a physical inspection to ensure a department within an organization or company has followed a documented recording system. _[reference]

The difference is that we can see how much binance has via blockchain and we know that they are definitely rich enough to cover all the deposits, meaning why would we care about some accounting firm and what they say about the audit?

The regular companies that have audits do not have blockchain along with them, so you have to trust the company that does the audit, but in this case it's different because Binance could simply show the blockchain and their wallets and you will see that they have the money for it. This difference means that audit and blockchain mean different things, and a company that has blockchain usage doesn't really need audit companies approval.

What I know also about with binance is they have insurance what you call SAFU.
We don't know the truth behind this audit, but I believe binance has enough funds to cover their customers.
I maybe biased as I am a regular user of binance, but I don't feel panic.
Maybe, don't store funds on them, but it is true to all centralized exchanges, right?
I don't think CZ will not be doing anything if there is really something wrong with their funds.

[Rikafip]

What I know also about with binance is they have insurance what you call SAFU.

I wouldn't count on SAFU if I'm were you. It may work for some smaller hacks, but when/if shit hits the fan, 1 billion USD won't save anyone. Worst of all, their SAFU fund mostly consists of their own tokens, BNB and BUSD (I read somewhere that those two make 75% of the SAFU). You can imagine how much those will worth if exchange ever gets into serious trouble.

I maybe biased as I am a regular user of binance, but I don't feel panic.

Its all good as long as you are aware of the fact that every time you send money there, it might be the last time you see them. At least that's how I see it as I am Binance user as well.

I don't think CZ will not be doing anything if there is really something wrong with their funds.

It all depends what kind of trouble Binance eventually has. If ist something like FTX, not even CZ will be able (or even willing) to do anything

[franky1]

unlike fiat laws.
crypto does not have any divine right of ownership outside the 'key control' owneship

when handing funds to a business. you are then subservient to the contract with that business(the user agreement)

binance does not have the same harsh user agreement rules as things like greyscale
binance has a clear proof of reserves and you can see the binance wallets balance openly using the tags on bitcoinrichlist.

however remember #not-your-keys-not-your-coin

binance is allowing users better access to coins(withdrawing when closing account), even in situations of banning a user.. compared to other exchanges user agreements.

other exchanges also dont deem funds as customers and can without notice take coins without reason

so always read the user agreements
though the implied rights given by user agreement can only be fully enforced in court if there was a breach/disagreement

so always make sure where you stand when using these services and limit utility to just using them for that day. and not as a custodian over weeks/months whereby you are not actively logging in or using the service daily with your fingertips

[ringgo96]

Since the decline in bitcoin continues to occur, there is currently a lot of negative news spread so that the future threat of the crypto world is getting worse and worse, and the auditor problem on binance is currently getting bigger and bigger even though the binance platform has been our mainstay for a long time and every problem there must be a way to be solved by the platform because we can see the CEO of binance always responding if there is a problem that occurs, Then don't equate the Binance platform with others, if this situation will continue then things will get worse in the future.

[DrBeer]

A few questions about Binance:
1. Do you store assets on this exchange?
2. How big are they? You can not answer with numbers, at least at the level - significant for me / not significant
3. After the news about potential problems appeared - did you withdraw your assets from the exchange? If not, why do you trust Binance?

Currently, I'm just accumulating bitcoins, so I have no reason to store my assets on binance, but I still use binance for things like exchanges, and p2p transactions as needed.

I can tell you that binance is the biggest exchange in the market, and it is so big that Binance's trading volume is equal to 10 different exchanges combined. I'm not saying binance will never die, but if it crashes, we'll see bitcoin drop to $5k or less, and we'll experience a longer bearish season than ever. You can check out their assets and everything needed to prove how big it is at coingecko.

I completely agree with you! I'm just interested in the opinion, and the acceptability of the use of Binance now by forum members. I am also well aware that the scale of Binance’s influence on the entire crypto world is very strong, and any negative situations with Binance are guaranteed to negatively affect both the Bitcoin exchange rate and the entire crypto market at once.
Just in case, I withdrew the stocks that were on Binance, and use them only for the exchange operation. If there are no changes in the next 1-3 months, I will return back to the Binance accounts what I stored and used for regular trading