Binance secretly accessed independent US arm to move $400 million to CEO Zhao linked company: Reuters
|- Binance transferred the money to Merit Peak, a company that named Binance CEO, ChangPeng Zhao as manager.
- Investor and Shark Kevin O’Leary, believes BNB has no intrinsic value as a token.
- Earlier last month, Binance also faced scrutiny for its $1 billion BUSD-peg stablecoin backing gap.
Binance is currently a fish covered in chum attempting to hide in different ways, failing to do so nonetheless. As revelations about the company pile up, the market is concerned about the potential blowback that could occur if Binance were to go down.
Binance moves around US arm’s money
Binance, according to a report from Reuters, has been moving around money from its account to a company known as Merit Park. However, the company had no direct conversation due to Binance CEO ChangPeng Zhao’s (CZ) relation to the company. CZ is acting as a Manager at the company, and the money moving now certainly calls for suspicion.
Binance used its sister company Binance.US account at Silvergate Bank to send money, resulting in the flow of more than $400 million during Q1 2021. This transfer of funds highlighted that Binance had some sort of secret access to Binance.US accounts.
This leads to the point that Binance.US is not as independent as it had been considered. As noted by many Reuters commenting,
“The Department of Justice and the Securities and Exchange Commission have sought information from Binance and Binance.US about their relationship as part of ongoing nvestigations into potential breaches of financial rules, including whether Binance is using the merican exchange as cover for doing business in the US. The SEC and the Justice Department eclined to comment for this article.”
While Binance faced this on one front, on the other, its native token Binance Coin took a shot as well. During an appearance on Yahoo finance, investor and Shark Tank judge Kevin O’Leary, stated that BNB was simply a token built for the cryptocurrency exchange and that it had no intrinsic value.
Even then, cryptocurrency has a strong influence on the story of the topmost altcoins. According to the shark, even though cryptocurrency is not a traditional token, it still holds enough power to mess with the entire crypto market.
Binance and its problems
These allegations came less than a month after Binance clarified the air surrounding the $1 billion BUSD-peg stablecoin backing gap. Back in January, the cryptocurrency exchange admitted that due to periodic rebalancing, Binance-Peg BUSD did not always seem to be backed by Paxos-issued BUSD.
The reports last month also suggested that there were moments in the past two years when the stablecoin was undercollateralized, to which Binance responded with “a timing mismatch” in backing the stablecoin. Surprisingly, these reports bore no impact on the price at all.
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