Binance bitcoins audited by Mazars: reassuring results

Around 100% – After FTX filed for bankruptcy, Binance CEO Changpeng Zhao issued a list of best practices for crypto exchanges. These rules emphasize the importance of transparency, a requirement that Binance has complied with by undergoing an audit.

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Binance audit by Mazars: transparency by the numbers

In a report of December 7, the cabinet Mazars shared the results of the audit on Binance reserves. The interpretation of numbers requires a sufficient understanding of the concepts ofIn-Scope Assets, and its opposite, the Out-Scope-Assetsmentioned in the document.

The In-Scope Assets are made up of client spot and margin accounts, but also derivatives, loan, financing and earn accounts for the Bitcoin (BTC) and wrapped bitcoins BBTC and BBTB, which are hosted on the BTC, ETH, and BNB blockchains.

Regarding Binance’s asset balance, Mazars reported that the crypto exchange “ was 101% guaranteed “, including the In-Scope Assets lent to customers in the form of margin or loans, which are secured by Out-Scope-Assets of a higher value.

Under this condition, the balance of assets in Bitcoin is slightly higher compared to the net balance of liabilities which amounts to 575,742.42 BTC, a figure that excludes In-Scope Assets loaned to customers.

However, this level of guarantee drops to 97% when the audit does not take into account the Out-Of-Scope Assets that customers pledge for In-Scope Asset lent, through the use of margins or lending services.

Concerning the temporal dimension for the interpretation of these figures, Mazars specifies in his report that Binance asked the firm to carry out an “agreed-upon procedures” engagement – or Agreed upon procedures (AUP) type in English.

This mission focused on the clients’ cryptocurrency assets and the corresponding liabilities owed to them, at 23:59:59 UTC, November 22, 2022.

In a tweet from November 28, Changpeng Zhao had to explain the reasons for a transfer of bitcoins worth more than 2 billion dollars, which the crypto exchange carried out. According to Binance’s CEO, the company wanted demonstrate to the auditor that it controlled the portfolio. With this new report published by Mazars, will the crypto community be more reassured about the management of Binance client funds?

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