Shareholders are being calmed by Binance, but its assets are still a mystery.

After FTX's bankruptcy, the biggest cryptocurrency exchange in the globe is attempting to calm investors about the security of their assets. Due to its prominence, Binance's achievement or failure will have a significant impact on the whole cryptocurrency market.

“Its important for us to show users that the coffers are not bare, like at FTX,” Patrick Hillmann, chief strategic officer of Binance, noted.

Although Binance just announced a promise to openness, financial and accounting experts say it still has a long road ahead to travel before it exposes enough crucial data to inspire investors' trust in its future.

Binance has made information regarding the addresses of its cryptocurrency wallets public during the span of a month. It has engaged an independent accounting company to create a “proof of reserve report” that includes a tiny amount of financial information and covers a percentage of its assets and liabilities. Additionally, it has vowed to release additional details soon.

“When we say proof of reserves, we are specifically referring to those assets that we hold in custody for users,” According to Binance's homepage.

By doing that, Binance is demonstrating and proving that the exchange has sufficient resources to cover all of our users' assets in full, in addition to certain reserves.

According to Douglas Carmichael, a former chief auditor of the United States and a professor of accounting at Baruch College in New York, investors should not have been content with the findings just yet. board for public company financial supervision

Since Binance is a privately held company, it is not obliged to continue providing audited financial accounts, and the company hasn't disclosed anything that could give a complete view of its liquidity or financial situation. It hasn't even made any arrangements to do so.

A five-page statement from an associate at the South African subsidiary of the international accounting firm Mazars is the reserve report, which was made public on Wednesday. There were three digits on it. The document states Mazars did “not express an opinion or an assurance conclusion,” which meant it wasn't endorsing the figures and that it wasn't an audit report that addressed the efficacy of the organization's corporate financial reporting procedures.

What might develop if Binance faced a deficit？ In a news release dated Nov. 9, the corporation referenced a “emergency insurance fund” known as the “safe asset fund for users,” or SAFU for short. “We've topped the SAFU control back to” $1 billion, the business declared.

According to Binance, the account was made up of both bitcoin and two of the company's own currencies, Binance USD and BNB. The fund's assets and debts are not disclosed in the bank records Binance has produced, but the company notes on its website that “the value of the fund will change based on the market.”

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