Mazars, the accounting firm that last week reported a proof of reserves posted by cryptocurrency giant Binance, has pulled the report from its website and no longer offers the service for its crypto clients.
Binance, the world’s largest crypto exchange, tweeted a link to the report on Dec. 7 as it seeks to reassure customers about its reserves following the collapse of competitor FTX last month.
Mazars removed the report from its site on Friday, according to The Wall Street Journal.
“Mazars has paused its activity related to providing proof of reserve reports for entities in the cryptocurrency sector due to concerns about how these reports are understood by the public,” the accounting group said in an emailed statement to FOX Business. .
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A spokesperson for Binance said that Mazars “has indicated that they will be temporarily suspending work with all of their crypto clients worldwide, including Crypto.com, KuCoin and Binance. Unfortunately, this means we will not be able to work with Mazars for the time being.”
“At the end of the day, our users want to know that their money is safe and that our company is financially strong,” Binance continued its statement. “Therefore, Binance’s capital structure is debt-free and Binance has passed a stress test over the past week that should provide extraordinary reassurance to the community that their funds are safe. Despite the large number of withdrawals from December 12-14, $6 billion in net recordings over three days, we were able to fulfill them without slowing down the pace.”
Binance said it has reached out to several major accounting firms, including the Big Four, seeking a willingness to conduct proof of reserves. The crypto exchange said the Big Four — that is, Deloitte, Ernst & Young, KPMG and Pricewaterhouse Coopers — are all “unwilling at this time to conduct a PvE for a private crypto firm.”
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The crypto industry has been rocked by the demise of FTX, leaving investors with major jitters after a bank run showed the exchange — at one point worth about $40 billion — didn’t have enough reserves to honor the withdrawals. The company filed for bankruptcy last month, resulting in billions of dollars in losses for an estimated one million customers worldwide.
FTX founder Sam Bankman-Fried was arrested Monday on several charges related to his company’s collapse, sparking calls for tighter regulation of the crypto industry by jurisdictions around the world — including requiring proof of reserves .
Binance founder and CEO Changpeng “CZ” Zhao told CNBC’s “Squawk Box” this week that “the well-run crypto exchanges should hold users’ assets one to one.”
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“People can withdraw 100% of their assets on Binance,” said Zhao. “We will not have a problem any day.”