It should be noted that Binance regularly faces criticism. More often than not, such statements are unfounded, but there are exceptions. In particular, in January 2023 representatives of the platform admitted that they made a mistake in storing users’ cryptocurrencies. At that time, users’ coins ended up at the same address where certain tokens were stored, which contradicts the rules of the exchange itself.

However, the current batch of criticism proved to be strange. Zhao eventually responded and set the record straight.

What’s wrong with Binance?

An investigation into bank transfers revealed that more than $400 million in a series of transactions were sent from an account controlled by Binance.US to a Merit Peak trading firm in 2021. Meanwhile, the Securities and Exchange Commission (SEC) began investigating potential links between Binance.US and the same trading firm in February 2022. Journalists compared what happened to the movement of funds that occurred before FTX’s bankruptcy was announced.

According to them, “Binance’s asset shuffling is very similar to FTX’s manoeuvres”. In fact, that’s the title of the article, which prompted a reaction from the cryptocurrency exchange’s founder.

In short: The journalists focused on transactions from 2022, in which the equivalent of $1.8 billion in stabelcoins was withdrawn from Binance as collateral. The coins went to representatives of the bankrupt trader Alameda and Cumberland/DRW, which the journalists did not like. However, as can be deduced from the responses of the exchange's head Changpen Zhao, the representatives of the listed companies simply withdrew their crypto assets from the exchange.

Here’s what Zhao responded to.

They [journalists – editor’s note] don’t understand the basic workings of crypto exchanges. Our users are free to withdraw their assets at any time. Their withdrawn funds turn into “hundreds of millions in collateral received”.

According to Cointelegraph’s sources, this refers to a “maneuver” in which Binance transferred $1.8 billion as collateral against steiblocoins to hedge funds represented by Tron, Amber Group and Alameda Research between August and December 2022. The latter is a trading company founded by former FTX CEO Sam Bankman-Fried.

According to Zhao, this fact shows that the media is trying to draw parallels between his company and Bankman-Friede’s crypto empire. However, journalists are “turning a blind eye” to the flow of funds to Binance – user deposit transactions. Here’s another of his quotes.

Binance has stood the test of time: users safely withdrew billions of dollars in December.


That is, representatives of Alameda and other companies mentioned above first sent coins to Binance, and only after that withdrew them. Accordingly, the exchange has nothing to do with securing the companies' positions, because representatives of the latter simply disposed of their own assets. This is why Zhao said that journalists do not understand how the cryptocurrency exchange works.

To be fair, comparing Binance to FTX solely because of the former's large scale of operations is unfair and manipulative. After all, Binance has been in the market for a long time and holds billions of dollars worth of users' crypto assets in its reserves. On top of that, the company has successfully survived a series of materials and rumours about alleged solvency issues in December 2022.


As a reminder, Binance was also massively criticised late last year, citing the exchange’s similarities to FTX. In retrospect, this PR campaign looks awful, as in fact news outlets and some prominent blockchain industry spokespeople have been fomenting panic around Binance for no good reason and hinting at its imminent closure.

Most importantly, many users withdrew record amounts of crypto from the trading platform amid the panic. In mid-December 2022, crypto-assets withdrawals from Binance totaled the equivalent of $6.1 billion.

Zhao continues.

The article makes a serious attempt to lump Binance and FTX into the same category – also with the headline in mind. However, we are different. Binance has stood the test of time as users withdrew billions of dollars in December.

Overall, Zhao expressed disappointment with the quality of Forbes’ content.

The topic of my Chinese origin was brought up again as if it mattered. I am deeply disappointed that Forbes continues to write baseless articles while losing its own credibility.

He also pointed out that it was Binance that started actively promoting the practice of publishing trading platform reserves, which can now be assessed on trackers like CoinMarketCap. This information allows you to realize how big the reserves of a particular trading platform are. Well, they allow traders to withdraw their own assets at any time.


What's particularly amusing here is that Binance invested in Forbes in February 2022. The investment amounted to $200 million. As Changpen Zhao pointed out at the time, the investment was to help the publication build Web3 infrastructure.

In June, however, Forbes' attempts to go public failed, prompting Zhao to announce a change in the companies' investment agreement. What exactly happened between them is unknown. Although judging by the current materials, Forbes representatives are not particularly interested in promoting blockchain solutions.


Pressure on Binance also persists from the US Securities and Exchange Commission over Paxos, which is the issuer of the BUSD exchange’s Stablecoin. Recall that Paxos was recently banned from issuing BUSD, causing the token’s capitalisation to gradually decline. It looks like Binance will now have to find new ways to issue the staplecoin.


We think the position of Forbes journalists is suspicious. Firstly, they are now actively comparing Binance with FTX, the head of which in its time was repeatedly included in various rankings of the publication. Secondly, the news about the crypto exchange is easily explained by the fact that representatives of the mentioned funds simply withdrew their coins from Binance. According to Changpen Zhao, such actions by journalists will cause Forbes to lose its audience over time. From all appearances, this will be the case.