<p>Binance, the world’s biggest cryptocurrency exchange by trading volume,
admitted to storing by “mistake” customers’ funds and the collateral of some of
the tokens it issues. </p><p>According to Bloomberg, Binance issues 94 Binance-peg tokens, also
called ‘B-Tokens’. However, almost half of the reserves of these tokens are kept together with
customers’ funds in a cold wallet called ‘Binance 8,’ the outlet said. The wallet’s tokens reserve
currently outnumber the volume of B-Tokens the leading crypto exchange has
issued, Bloomberg also said in a report. </p><p>Furthermore, the outlet said its calculation shows that over $539 million in
B-Tokens have been affected as a result of the mixing. However, a spokesperson who spoke to the news platform assured that users funds are backed 1:1 and added that
the exchange is taking steps to rectify the situation.</p><p>Watch the recent FMLS22 on reimagining the crypto structure.</p><p>CEXs Battle User Confidence Post FTX</p><p>The new development at Binance comes as centralized exchanges face greater scrutiny
following the November collapse of Bahamas-based <a href=”https://www.financemagnates.com/terms/c/cryptocurrency-exchange/” class=”terms__secondary-term” id=”601e2e5f-0c28-4253-9ad4-5e6b251ba2fa” target=”_blank”>cryptocurrency exchange</a>, FTX,
which allegedly released customers’ funds to sister trading firm, Alameda Research.
FTX is still undergoing bankruptcy proceedings in the United States.</p><p>Over a month ago, global financial auditor Mazars in a report noted that
Binance’s reserves for Bitcoin was over-collaterized, standing at 101%, as
against the regular 100% or 1:1 asset-to-reserve ratio. Binance first <a href=”https://www.financemagnates.com/cryptocurrency/binance-launches-proof-of-reserves-for-btc/” target=”_blank” rel=”follow”>launched</a> its
proof-of-reserves (PoR) for BTC in November last year.</p><p>Away from Binance, in a bid to assure their users of their financial health, other
cryptocurrency exchanges have also announced PoRs for their digital asset
holdings. Last week, Seychelles-based crypto exchange OKX released its PoR
which shows that the platform is <a href=”https://www.financemagnates.com/cryptocurrency/okx-releases-proof-of-reserves-shows-75-billion-in-btc-eth-and-usdt/” target=”_blank” rel=”follow”>also over-collaterized</a>, with about $7.5
billion in digital asset holding.</p><p>Finance Magnates reports that while OKX’s users hold a total of 117,682
BTC , 1,178,993 ETH and 2,955,696,824 USDT, the crypto exchange’s reserve ratio
stood at 105% for the first two digital assets and 101% for the <a href=”https://www.financemagnates.com/terms/s/stablecoin/” class=”terms__main-term” id=”e84b040e-4d12-499b-99bf-8ba75ea058ca” target=”_blank”>stablecoin</a>. </p><p>Meanwhile, Singapore-based <a href=”https://www.financemagnates.com/cryptocurrency/cryptocom-releases-audited-proof-of-reserves/” target=”_blank” rel=”follow”>Crypto.com</a> and another crypto
exchange <a href=”https://www.financemagnates.com/cryptocurrency/bitget-shares-proof-of-reserves-launches-merkle-validator/” target=”_blank” rel=”follow”>Biget</a> also recently
launched their PoRs. The asset-reserve ratios of the major cryptocurrencies on
Crypto.com include: BTC (102%), ETH (101%), USDC (102%), USDT (106%), USDT
(106%) and XRP (101%). Others are Dogecoin (101%), Shiba Inu (102%), Link
(101%) and Mana (102%).</p>
This article was written by Solomon Oladipupo at www.financemagnates.com.
