SNEAK PEEK
- Binance, a cryptocurrency exchange, and Mazars, an accounting company, are working together on proof-of-reserve (PoR) audits that Binance is undertaking as a result of FTX’s liquidation.
- The U.S. division of Mazars has long served as Donald Trump’s company’s accounting supplier.
- A representative for the exchange indicated that Binance is hiring Mazars to independently verify its reserves.
As part of its proof-of-reserve (PoR) audits brought on by the demise of FTX, cryptocurrency exchange Binance is collaborating with accounting firm Mazars.
The Wall Street Journal reported on Nov. 30 that Mazars, the accounting firm that worked for the business of former US President Donald Trump, had been chosen as the official auditor to carry out a “third party financial verification” as part of Binance’s PoR upgrades.
The accounting firm is allegedly already analyzing all of Binance’s information on Bitcoin PoR that has been made publicly available and will also be checking upcoming upgrades and tokens, according to a representative for Binance. The representative continued, “The first BTC verification upgrade will be finished this week.”
Following the demise of rival FTX, Binance is introducing a mechanism known as proof-of-reserves to persuade investors that their money is secure. The appointment is a part of this scheme. Investors can use the technique to determine whether individual holdings are covered by reserves.
To give an outside check on their declared assets and, in some circumstances, liabilities, several crypto businesses, including exchanges and stablecoins, employ external auditors. These confirmations, which approve a snapshot of the assets at a certain time, are usually a lot less detailed than an audit.
A mid-tier international accounting firm is Mazars. Formerly employed by the business of former President Donald Trump was its American subsidiary, Mazars USA. Mazars USA announced earlier this year that it would stop working with Mr. Trump’s company and that it could no longer stand by the financial statements it had previously created.
In the wake of the FTX collapse, many other exchanges, including OKX and KuCoin, have been working extremely hard to keep their clients’ faith. Binance is not alone in this effort. Meanwhile, some industry watchers think that the exchanges’ current PoR method is mainly ineffective unless they additionally give liabilities, which are exceedingly difficult to forge.
