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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

#241

Post by bluecalm »

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…

>>But if the fraud results in obvious material discrepancies then the audit would catch it and the auditor would resign

Explains "no auditor wants to work with us" line used by Tether among other crypto projects.

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

#242

Post by hef19898 »

birracerveza wrote: post #239
hef19898 wrote: post #184

Earlier quoted context omitted.

I thought Germany's dependency on Russian gas was the reason this time?

It depends on how the media wants to spin it. My point was, even if the whole crypto ecosystem went to zero right now, the effects on the economy at large would be negligible. However, it would be the perfect scapegoat to finally crash the economy with no survivors. The media would not have a problem with just blaming it all on crypto: as you can see here, people are already very eager to do so! No other explanation…

Whom exactly would want to crash the whole economy?

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

#243

Post by likpok »

jcranmer wrote: post #65
monero-xmr wrote: post #11

Binance is the closest thing to a global, borderless bank that exists today. They exist everywhere and nowhere. Their legal entities shift based on what is needed at the moment. They have the ability to easily create tens of millions of dollars as needed based on their BNB reserves, tight relationship with Tether, their ability to launch new token projects (i.e. unregulated securities offerings), and their stablecoin…

Ooh boy... > Binance is the closest thing to a global, borderless bank that exists today. There are several very large international banks you're ignoring. > They exist everywhere and nowhere. I read this as "we can do business with you everywhere, except if you need to sue us, at which point you can't sue us anywhere." Which is a massive red flag. > Their legal entities shift based on what is needed at the moment. M…

> The thing about too big to fail is that it's not that someone is so big there's no way they can fail; it's that someone is so big the government is forced to bail them out instead of letting them fail. Given that cryptocurrency is dominated by people at best thumbing their noses at the idea of government control, what government is going to be willing to step in to save the failing too big to fail crypto bank?

This is some of why tether is still going strong, I think. Everyone in the crypto economy has enormous exposure to tether blowing up, so everyone tries to ignore it.

The people doing the bailing out are everyone who holds crypto, I guess. This was done explicitly when Bitfinex's money launderer stole their money -- Bitfinex did a "bail-in" where they gave all their customers except coinbase something like an 80% haircut.

Not saying you're wrong, but there is a parallel that has propped up the ecosystem for quite some time! And I guess it gets worse: as too-big-to-fail entities don't fail, they get bigger and perceived-safer which works until it doesn't.

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

#244

Post by novok »

simiones wrote: post #153
sneak wrote: post #42

Earlier quoted context omitted.

For the time being? Keeping your funds on an exchange (or in a bank) means they are, quite literally, not your funds. If you don't want the risk of loss, don't give your money to second parties .

That's true for an exchange, but is absolutely not true for a bank (in a well-run modern state). At least if you don't have millions+ of dollars in the bank, the state ensures that even if the bank were fraudulent, your money is still your money.

They don't really for brokerage accounts, which is what most people's retirement savings actually are in.

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

#245

Post by simiones »

novok wrote: post #244
simiones wrote: post #153

Earlier quoted context omitted.

That's true for an exchange, but is absolutely not true for a bank (in a well-run modern state). At least if you don't have millions+ of dollars in the bank, the state ensures that even if the bank were fraudulent, your money is still your money.

They don't really for brokerage accounts, which is what most people's retirement savings actually are in.

The post I was replying to was saying "Keeping your funds on an exchange (or in a bank) means they are, quite literally, not your funds.". I was pointing out that it's absurd to compare unregulated crypto exchanges to proper banks (in a working state - I am sure banks in failed states can well be just as bad).

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

#246

Post by nradov »

throwawaymaths wrote: post #236
cm2187 wrote: post #230

Earlier quoted context omitted.

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

It's fraud when you tell investors incorrect things in prospectuses, for example. These things are required to be signed off by auditors to participate in us stock exchanges

What specific statements were incorrect in the Evergrande prospectus?

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

#247

Post by dibt »

coopierez wrote: post #112
rkagerer wrote: post #84

Earlier quoted context omitted.

almost universally hated by the whole population Can you source that? It feels to me like a gross exaggeration. Anecdotally I know more people that are passionate about it or just don't care than anyone who really hates it.

8% of (American) people have a positive view, 43% have a negative view. The rest don't care or are neutral. So although not a majority, it's pretty close. https://www.cnbc.com/2022/12/07/just-8percent-of-americans-h...

At the bottom of the article:

"Negative views on crypto come at the same time as the public has soured on stocks. Just 26% say now is a good time to invest in equities, down two points from last quarter's survey and the most pessimistic level registered in the 15-year history of the survey. 51% say it's a bad time to invest, the third highest in the survey's history, bested only by the downbeat results of the prior two surveys."

It's an example of Base-Rate neglect.

https://en.wikipedia.org/wiki/Base_rate_fallacy

Often done in media due to a bias they are attempting to confirm. Almost all financial assets are down, and not appealing to retail investors. Negative news gets clicks.

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

#248

Post by fisherjeff »

Hamuko wrote: post #185
fisherjeff wrote: post #47

I feel like if I were a Binance investor and they came to me and said “Hey so everything is fine, just look at these three numbers I asked Mazars to write down. Also there are a ton of caveats but you get the idea,” I would immediately 100% panic. How does this reassure anyone?

> How does this reassure anyone? By only saying "Hey, so everything is fine, just look at this fancy report with a fancy name on it" and assuming that they don't actually read it.

Ordinarily I'd say no that doesn't make sense - their investors are sophisticated and they have teams that dig into this sort of thing all day long. After FTX, I don't think that holds as much water anymore.

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

#249

Post by hintymad »

nova22033 wrote: post #198

https://www.reuters.com/markets/us/us-justice-dept-is-split-... WASHINGTON, Dec 12 (Reuters) - Splits between U.S. Department of Justice prosecutors are delaying the conclusion of a long-running criminal investigation into the world's largest cryptocurrency exchange Binance, four people familiar with the matter have told Reuters. The investigation began in 2018 and is focused on Binance's compliance with U.S. anti-mo…

Now do SBF.
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