Binance US Denies Clashes Calling A Company Has A Relations With CZ's Merit Peak

Binance.US denied oblique accusations. (Photo; Doc. Nomics)

JAKARTA - Binance US, a US-based cryptocurrency trading platform affiliated with global crypto exchange Binance, has denied recent allegations that it is a fraud and bankrupt exchange. Both Binance and Binance US have stressed that both are separate entities with different management teams.

In a recent tweet, Binance US's official account responded to the allegations, saying, "There are many attempts to equate Binance US with a fraudulent and bankrupt exchange. There is no comparison." The exchange then provided evidence to support its claims.

Binance US first explained that its leadership consisted of former employees of the US Department of Justice (DOJ), the Securities and Exchange Commission (SEC), the Federal Bureau of Investigation (FBI), and the Federal Reserve Bank of New York (NY Fed). The exchange detailed, "Our leadership team consists of former DOJ employees, SEC, FBI, and NY Fed who are committed to operating secure platforms that comply with US laws and regulations."

Binance US then responded to allegations first published by Reuters that Binance had "secret access to US independent partner-owned bank accounts." The publication further accused the exchange of disbursing more than $400 million from the Binance US bank account to Merit Peak Ltd, a trading company managed by Binance CEO Changpeng Zhao (CZ), in the first three months of 2021.

"Despite a market maker named Merit Peak operating on the Binance US platform, the company halted all activity on the platform in 2021," Binance US claims. "We list our competitive and transparent market maker program on our website, which shows that companies are competing fairly for rebates." The exchange asserted, "Only Binance US employees have access to the Binance US bank account. Point."

Additionally, Binance US assured the crypto community that they are not using customer funds, a topic highlighted after the collapse of FTX, a exchange suspected of mixing customer funds. Binance US stressed, "Binance US has never - and will never - trade or lend customer funds. Binance US always maintains 1:1 reserves and is subject to routine audits and regulatory reporting by government entities."

Recently, the SEC has taken action against several crypto companies, including Kraken over its staking program, Paxos over the issuance of Binance USD (BUSD) stablecoins, and Terraform Labs for defrauding investors as Bitcoin.com News reports. Last week, SEC Chair Gary Gensler proposed changing federal detention regulations to include all crypto assets.