Finance experts say Binance’s recent move to provide more transparency isn’t quite transparent enough.
That’s according to a Saturday (Dec. 10) report by the Wall Street Journal (WSJ), citing interviews with specialists in accounting and finance.
Binance, the world’s largest cryptocurrency exchange, has recently sought to offer customers reassurance following the collapse of FTX.
“It’s important for us to show users that the coffers are not bare, like at FTX,” Binance’s chief strategy officer, Patrick Hillmann, said in an interview with the WSJ.
The company has recently published details about its crypto wallet addresses, and this week released information from the auditing firm Mazars showing Binance had enough bitcoin in reserve to cover its liabilities.
That shouldn’t be enough for investors, Douglas Carmichael, an accounting professor at Baruch College in New York and former chief auditor of the U.S. Public Company Accounting Oversight Board, told the WSJ.
“I can’t imagine it answers all the questions an investor would have about the sufficiency of collateralization,” Carmichael said. “That’s the main thing it seems to speak to.”
As PYMNTS wrote recently, FTX’s rivals and peers have scrambled to distance themselves from the fallen company and the oversight failures that led to its collapse.
But much more needs to be done, Ron Kruszewski, the chairman and CEO of investment banking firm Stifel, told PYMNTS’ Karen Webster last week.
“Let’s ask [these companies] the tough questions,” Kruszewski said. “These are the people building the ecosystem, they need to make sure everyone has confidence in it. I’d really like to see that.”
He argued the crypto industry has been set back by as much as a decade due to FTX’s implosion and the resulting fallout, adding that innovation can’t happen until rules are in place.
“You can’t really have destructive technology in the financial system,” said Kruszewski. “The U.S. has the most sophisticated, deep and fair markets in the world because we put good rules and regulations in place, and we need to do that for crypto — and then crypto can flourish and [consumers can] enjoy its true business applications versus where it stands now, unregulated, just a casino.”
How Consumers Pay Online With Stored Credentials
Convenience drives some consumers to store their payment credentials with merchants, while security concerns give other customers pause. For “How We Pay Digitally: Stored Credentials Edition,” a collaboration with Amazon Web Services, PYMNTS surveyed 2,102 U.S. consumers to analyze consumers’ dilemma and reveal how merchants can win over holdouts.
We’re always on the lookout for opportunities to partner with innovators and disruptors.
Post expires at 10:38am on Sunday March 12th, 2023