Binance Denies Reuters Report That It Commingled Customer Funds

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Sarah Wynn

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Sarah Wynn

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October 23, 2023 06:42 EDT

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Binance is pushing back against a Reuters report that said the world’s largest cryptocurrency exchange commingled customer funds with company revenue in 2020 and 2021. 

Binance Chief Communications Officer Patrick Hillmann called the story “weak,” in a five paragraph tweet on Tuesday.

“This story is so weak that they had to put up front, ‘Reuters found no evidence that Binance client monies were lost or taken’ in a transparent attempt to protect themselves from a libel suit,” Hillmann said. “Underneath that, they then pinned 1000 words of conspiracy theories (which we explained were false) with zero evidence other than a “former insider.”

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

Reuters said that the exchange commingled customer funds with company revenue in 2020 and 2021, citing sources familiar with the situation. 

“… the news agency reviewed a bank record showing that on Feb. 10, 2021, Binance mixed $20 million from a corporate account with $15 million from an account that received customer money,” Reuters reported.

Reuters did not immediately respond to a request for comment.

US regulators’ allegations against Binance 

Binance was accused by the US Commodity Futures Trading Commission in March of allowing trading firms based in the US to trade crypto derivatives on Binance’s international exchange. 

In a 74-age complaint, the CFTC said some of Binance’s entities had “commingled funds.”

The regulator also said CEO Changpeng Zhao had directed employees and customers to circumvent compliance controls in order to maximize corporate profits.”

The CFTC also said in its lawsuit that Binance had given some of its largest VIP clients advantages through faster trade execution. 

Zhao, also known as CZ, had called the CFTC complaint “unexpected and disappointing,” in a post. 

“Upon an initial review, the complaint appears to contain an incomplete recitation of facts, and we do not agree with the characterization of many of the issues alleged in the complaint,” CZ said.