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Analytical Perspective: Key Facts to Debunk the Myth of Binance's Insolvency

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Analytical Perspective: Key Facts to Debunk the Myth of Binance

The core contributor of the meme coin FLOKI, @100bviking, analyzes four facts to address the question of whether Binance is insolvent, leading us to re-examine several key FUD panic events.

Four Binance FUD Incidents

@100bviking stated that there are currently four events causing panic:

  • Mazars, the accounting firm, no longer auditing exchanges like Binance Read more
  • Rumors of Binance facing a run on its reserves and insolvency Read more
  • Binance's $2.1 billion FTT investment profit, currently worth about $500 million, could be recalled Read more
  • Does Binance hold a lot of BUSD, is it stable?

What happens if Mazars stops auditing Binance?

@100bviking believes that Mazars not only turned down auditing Binance but also services like Kucoin and Crypto.com.

He thinks this is a Mazars issue because the company considers auditing risks for crypto companies too high, which can be understood in the current climate. Since the FTX incident, traditional financial firms have become more cautious about cryptocurrencies. For example, some banks have started freezing bank accounts of crypto users.

Audit firms not working with crypto companies does not mean they are insolvent. Just like banks not providing services to crypto users does not mean anything.

Claims of a run on Binance/insolvency?

@100bviking stated that Binance's on-chain reserves exceed $55 billion. Claiming a run on Binance because some coins have been withdrawn is absurd.

@100bviking cited Paul Brody, head of Ernst & Young's blockchain division, who confirmed the reserves proof provided by Binance through his colleagues.

Although Paul Brody cannot represent EY, this incident shows that heads of blockchain divisions of major firms are aware of this.

Currently, there are many on-chain reserve data tracking related to Binance:

@100bviking believes that Binance processed over $14 billion in withdrawals in the past week but still has $55 billion in reserves. This does not look like an exchange facing a run. In contrast, FTX had almost no reserves left at that time and was scrambling for funds to meet user withdrawals. "Binance and FTX simply cannot be compared." CryptoQuant on-chain analysis

The $2.1 billion recall event CZ mentioned on CNBC?

@100bviking believes that those criticizing this either do not understand what CZ said or are deliberately distorting his response. Binance's $2.1 billion FTX share investment profit has nothing to do with user funds and will not affect withdrawals.

Even if the $2.1 billion were actually recalled, there isn't that much money. Because this investment profit is composed of FTT and BUSD, the actual value left after FTT plummets is minimal.

@100bviking stated that CZ's response during the interview, if the amount is recalled, it will be handled by lawyers, is completely reasonable.

Will there be an issue with BUSD?

@100bviking stated that many believe Binance holds a significant amount of its stablecoin BUSD, and there are concerns about its reserves. However, this is a complete misunderstanding,

because BUSD is not issued by Binance

BUSD is issued by the US stablecoin compliance issuer Paxos, backed by the US dollar and US Treasuries, and overseen by the New York Financial Services Department management. It is even more secure than USDT, which is not regulated by the US.

Thinking and Interpreting Media Information

@100bviking stated that much of the panic-inducing information is false, typically due to a lack of understanding of the facts or deliberate distortion of facts to create panic and confusion. His analysis hopes that everyone can objectively view the facts, as these are all public information.