Truth Behind Binance FUD December 22, 2022
Story: Divya Sinha
Since the FTX debacle in November, its massive role has come under greater scrutiny and alike FTX, Binance discloses limited financial information.
Also, Binance CEO has ties to market makers that provide liquidity on their own platforms, an arrangement some market watchers say creates a potential conflict of interest.
Larry Harris, finance professor and former SEC chief economist says when a business is not transparent and not regulated, then they have no true understanding of what is happening inside.
Adding to the investor concern, as per reports, an outside audit firm that Binance brought in to report on its reserves said it was suspending its work for crypto firms.
However, Binance Chief Strategy Officer Patrick Hillmann said Binance has tight controls overseen by its global risk department and the exchange is not trading against users.
He added, that private company are not required to produce financial statements, but Binance embraces additional transparency by providing proof of reserves.
However, Binance's lack of transparency and its operational structure has raised concerns from regulators.