Binance has been hit with allegations of secretly moving over $400 million from its US affiliate to a trading firm linked to its CEO, Changpeng Zhao.
A recent report by Reuters claims that between January and March 2021, a Silvergate Bank account named BAM Trading, which is operated by Binance.US, transferred these funds to Merit Peak, a market maker managed by Zhao himself.
However, Binance has denied these allegations and stated that it has no access to the bank accounts held by its US partner.
The company clarified that only Binance.US employees have access to these accounts, and the transfers were made without the knowledge of Binance.US executives.
The report did not confirm if the funds involved in the cash outflows belonged to Binance.US clients. In response, Binance has assured its customers that their funds are safe and that the company operates within the framework of US laws and regulations.
The crypto exchange also emphasized that its leadership team comprises former employees of the Department of Justice, Securities and Exchange Commission, Federal Bureau of Investigation, and New York Federal Reserve, who are committed to ensuring the safety and transparency of the platform.
Binance added that while Merit Peak did operate on the Binance.US platform, it stopped all activity in 2021.
The company listed its competitive and transparent Market Maker program on its website, where firms compete fairly for rebates. Furthermore, Binance.US maintains 1:1 reserves and is subject to regular audits and regulatory reporting by government entities.
