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Binance is trying to calm investors, but its finances remain a mystery

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Re: Binance is trying to calm investors, but its finances remain a mystery

#221

Post by heartbeats »

iudqnolq wrote: post #43
vgatherps wrote: post #41

Earlier quoted context omitted.

I mean fourth possibility is that binance is solvent right? I’m not assigning probabilities to any of them but taking their insolvency as a foregone conclusion seems pretty incorrect?

Assuming rational actors I can't see any reason to evade audits for years, even after litigation, unless the result of the audit would be bad.

Surely, the following two statements can be true at the same time?

1. Binance is run by criminals and all sorts of people would go to jail if anyone looked at their books.

2. Binance is solvent.

Not saying this is the case, but there's many other reasons for a crypto firm to be shady than their insolvency.

Re: Binance is trying to calm investors, but its finances remain a mystery

#222

Post by AdamN »

poutrathor wrote: post #218
prepend wrote: post #212

Earlier quoted context omitted.

Isn’t it telling that this work wasn’t done by the “big four?” Given that the Big Four like money and are ostensibly the biggest and oldest and with the best reputation. Any perceived shaky but actually strong firm would come out gangbusters with “Old Accounting firm stakes its reputation that we aren’t full of shit.” After the death/execution/seppuku of Anderson after Enron, the remaining four seem extra conservativ…

Mazars is 5th in Europe, 24 400 employees and it makes ~2 bilions in turnover. this above comment is not bringing much value to the discussion I think.

Ever since the Trump stuff, I don't think Mazar's gets alot of trust anymore:

https://www.nytimes.com/2022/02/14/nyregion/mazars-trump-org...

Re: Binance is trying to calm investors, but its finances remain a mystery

#223

Post by ceejayoz »

Kukumber wrote: post #208
nayuki wrote: post #72

Earlier quoted context omitted.

Binance owns CoinMarketCap since Apr 2020. I wonder how reliable the numbers are.

Network data is accessible by anyone, that's how crypto currencies operate, it's all public and trackable

Network data doesn't tell you that two wallets are friends or even the same person doing some wash trading.

Re: Binance is trying to calm investors, but its finances remain a mystery

#224

Post by AdamN »

ohgodplsno wrote: post #194
vgatherps wrote: post #135

Earlier quoted context omitted.

I think his defense is sort of: 1. We had a busted accounting system 2. Early on in FTX people had to route dollars via Alameda because banking is hard 3. We accidentally credited those dollars both to Ftx and Alameda 4. Each side thought they had billions to spend / lose (their VC and related spend was WILD), and suddenly, oops!!!!!! I suspect there's a grain of truth to this, in that steps 1-4 did actually happen t…

SBF recently said that both the FTX & Alameda/FTX Trading accounts were the same. People who signed up for just storage were exposed to the same risks as the trading degenerates. When everything collapsed, the trading degenerates could withdraw using the very same money that regular FTX users had put money in. It's fraud, from the beginning.

It's fraud for sure .. but it doesn't mean he intended to take the money or anything. He was just too naive to understand how dangerous mixing the funds would be during an inevitable period of pressure and (I'm guessing) felt like keeping the mondy separate is the kind of control that an overly bureaucratic bank would need, not a nimble startup like FTX :-/

Don't get me wrong, he should still go to prison.

Re: Binance is trying to calm investors, but its finances remain a mystery

#225

Post by throwawaymaths »

dhruval wrote: post #129
woodruffw wrote: post #4

From TFA: > The reserve report, released Wednesday, is a five-page letter from a partner at the South African affiliate of the global accounting firm Mazars. It contained three numbers. The letter wasn’t an audit report, didn’t address the effectiveness of the company’s internal financial-reporting controls, and said Mazars did “not express an opinion or an assurance conclusion,” meaning it wasn’t vouching for the nu…

Former auditor here: 1. That is standard wording for the report of "agreed upon procedures". This is not an audit it just means they only did a certain set of procedures rather than an audit. 2. Audits aren't really able to detect all fraud, especially if the management is sophisticated. But if the fraud results in obvious material discrepancies then the audit would catch it and the auditor would resign (unless they…

Don't forget the big four signed off on evergrande and other Chinese real estate and it seems like there will be no consequences (we can't have the big zero)

Re: Binance is trying to calm investors, but its finances remain a mystery

#226

Post by mbesto »

WalterSear wrote: post #93
xvector wrote: post #55

Earlier quoted context omitted.

See Tether. Crypto is just a massive house of cards that will collapse and drag the economy with it.

It's too small. It's entire, and arguably entirely fantastical market cap is still smaller than Apple.

> arguably entirely fantastical market cap

The idea of using market cap as a frame of reference for crypto needs to die. There are much stricter controls about how a company issues more stock (and thus can inflate or deflate the price) than how a cryptocurrency issues more coins. Also, cryptocurrency market caps are denominated as an exchange of fiat, whereas a company's market cap is in the fiat in which the company is actually sourced (e.g. NASDAQ).

You just can't compare the two.

Re: Binance is trying to calm investors, but its finances remain a mystery

#228

Post by YawningAngel »

poutrathor wrote: post #218
prepend wrote: post #212

Earlier quoted context omitted.

Isn’t it telling that this work wasn’t done by the “big four?” Given that the Big Four like money and are ostensibly the biggest and oldest and with the best reputation. Any perceived shaky but actually strong firm would come out gangbusters with “Old Accounting firm stakes its reputation that we aren’t full of shit.” After the death/execution/seppuku of Anderson after Enron, the remaining four seem extra conservativ…

Mazars is 5th in Europe, 24 400 employees and it makes ~2 bilions in turnover. this above comment is not bringing much value to the discussion I think.

I think it's a very reasonable observation. An audit from PWC is materially different to an audit from a local accounting firm with less of a reputation at stake. The parent happens to be in error about which category Mazar's falls into (since they're probably the largest accounting firm outside the big four), but people are going to make reasonable but ignorant comments sometimes. I myself thought the exact same thing and only didn't say it because I happened to google Mazars out of curiosity.

Re: Binance is trying to calm investors, but its finances remain a mystery

#229

Post by ohgodplsno »

AdamN wrote: post #224
ohgodplsno wrote: post #194

Earlier quoted context omitted.

SBF recently said that both the FTX & Alameda/FTX Trading accounts were the same. People who signed up for just storage were exposed to the same risks as the trading degenerates. When everything collapsed, the trading degenerates could withdraw using the very same money that regular FTX users had put money in. It's fraud, from the beginning.

It's fraud for sure .. but it doesn't mean he intended to take the money or anything. He was just too naive to understand how dangerous mixing the funds would be during an inevitable period of pressure and (I'm guessing) felt like keeping the mondy separate is the kind of control that an overly bureaucratic bank would need, not a nimble startup like FTX :-/ Don't get me wrong, he should still go to prison.

The MIT educated, son of two Stanford teachers, professors of law and business, brother to a Wall Street trader, Jane Street employee, extremely well connected kid was simply too naive :(

Sorry, but you're just giving in too much in his bullshit. Especially when FTX terms of service explicitly said that your funds would never be given to FTX Trading, and that they would be kept apart. It's not an accident. Separating the funds was consciously thought of and immediately followed up by "lol no".

Re: Binance is trying to calm investors, but its finances remain a mystery

#230

Post by cm2187 »

throwawaymaths wrote: post #225
dhruval wrote: post #129

Earlier quoted context omitted.

Former auditor here: 1. That is standard wording for the report of "agreed upon procedures". This is not an audit it just means they only did a certain set of procedures rather than an audit. 2. Audits aren't really able to detect all fraud, especially if the management is sophisticated. But if the fraud results in obvious material discrepancies then the audit would catch it and the auditor would resign (unless they…

Don't forget the big four signed off on evergrande and other Chinese real estate and it seems like there will be no consequences (we can't have the big zero)

Has there been an accounting fraud with Evergrande? Being overleveraged isn’t fraud.
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