Binance CEO Changpeng Zhao vehemently denied the U.S. Securities and Exchange Commission's (SEC) claim that he and his company were diverting $12 billion of client assets to companies under his control.
The SEC filed a lawsuit against Binance and Zhao on Monday, accusing it of operating an unregistered stock exchange, artificially inflating trading volumes, failing to keep US customers off its platform, and misleading investors with market surveillance controls.
In a statement on Twitter, Zhao said the claim was "completely false" and criticized the source of the information.
He said that Binance.US, the US subsidiary of Binance, has only about $2 billion in user funds, and that all user funds are accounted for and that the funds never leave the platform unless the users themselves withdraw:
“This is absolutely wrong. I'm not sure if the problem is with the journalist or with the source.
As far as I know, Binance.US had a total of around $2 billion in user funds. This figure is in USD equivalent and fluctuates a bit as crypto prices change. And due to the latest news, users are decreasing as they withdraw money.
All user funds are registered and never leave the Binance.US platform (unless users withdraw themselves, of course).”
For the lawsuit filed by the SEC, Binance.US said the SEC said the lawsuit was "baseless" and would defend itself in court. He also stated that user assets will continue to be safe and that the platform will continue normal deposits and withdrawals in the same way.
*Not investment advice.