Neosify - Buy, Stake & Earn Crypto
Neosify - Buy, Stake & Earn Crypto
Neosify - Buy, Stake & Earn Crypto

Binance's Black Box Accounting Issue

By Cje95 | Chronic Illness and Crypto | 18 Jan 2023

Black box accounting is a method used to obscure financial reporting and confuse a financial statement reader without doing anything that violates the law. In essence, it muddies the waters and covers up how a business is really doing, and promotes a view that might not exactly be the whole truth. The key thing about it is that it is not illegal so while those in accounting will call it out and look down upon it there is not anything "wrong" that someone could end up in jail for. Regulations make it nearly impossible for publically traded companies to participate in this type of accounting but when it comes to being a private company and thus you do not have to open up your books to regulators as much this type of accounting can run rampant. That is not to say that Binance is doing this or trying to appear shady in any way but it is the sort of view people have of them now. 


An example of these practices that have become publically known includes when Binance published their reserves only for billions to be moved shortly thereafter. They also had their auditing firm not only quit on them but then pull out of the crypto industry overall and that is just not a good look to have whatsoever. A couple of weeks ago when CZ was on CNBC to talk about Binance and FTX it was brought up that the bankruptcy people for FTX could claw back the $2 billion paid to Binance from FTX. What occurred was a classic case of someone not expecting the question nor being able to pivot on their feet to handle this line of questioning as he poorly tried to avoid this question. Again while not illegal it does not cast a healthy light on the business. 


After watching FTX go on its buying spree before it fell it is concerning that Binance has more or less followed the same path. They or their subsidiaries have announced the creation of a fund to bail out affected projects and businesses and they are working to close the Voyager acquisition that FTX had to abandon. Not only that they are expanding their staff headcount during a time when even businesses with cash reserves Bianace could only dream of are laying people off due to the economic uncertainty. There is also the issue of BUSD demand falling which if it continues will drag down Binance and its finances overall. 


Binance is suffering from the classic issue that modern private companies face and that is the lack of transparency. I find it pretty funny since Binance is operating in a space that is supposed to be all about transparency but that is not the case with Binance. This lack of transparency is resulting in issues with regulators and investigations into the company. Binance then has to spend considerable resources on having to handle these investigations and already we are seeing these weigh on Binance with the SEC filing an objection to the Voyager acquisition. Even with the judge allowing the process to continue as we have seen with FTX the lack of transparency could result in massive massive issues in the end. 


I would not be surprised to see widespread changes at Binance in the coming months. While they have operated in a work-from-home style for a long time I would expect to see them launch something like small branches/headquarters in major countries of operations and really highlight these. Having forward-facing physical locations with workers in the US and European countries will provide some level of comfort to regulators and could give Binance more breathing room. Do these places need to be extravagant like we have seen with FTX or Silicon Valley tech companies? No not at all and honestly if they were I think that opens up a whole new set of questions. 


Binance needs to change from the way that it is currently operating though because of the damage FTX has caused. While Coinbase is not perfect its books are much much more open and publically available for people to see so following in their footsteps would not be the craziest idea. That's not to say that Binance needs to go public and I would argue that it would be worse if they did but the public nature of Coinbases books would be a huge benefit to the industry and Binance itself. 




If you have made it this far right now you can get 50,000 sat for free from Fold if you sign up for their FREE Fold debit card here. As of writing this that is a little over $10 in Bitcoin just for signing up!  I cannot say better things about Fold as they have helped me stack almost 2,500,000 sats with just regular purchases I have to make! If you are interested in what types of gift cards and benefits they have going on this month here is a previous post on it! Again it's free to sign up so why not do it get your 50,000 sat check them out! Please know I am not a financial advisor and make sure you do your own research! If you enjoyed this article and would like to support me further below are a few referral links that if you used when signing up I would appreciate it! Also, follow me on Twitter @Cje95_


Fold App

Offers daily wheel spins to win free sats daily! If you sign up for Fold with my link here you will get 50,000 sats for free!  



Robinhood is offering an excellent signup deal if you use my link here where we will both be awarded free stock. All that you have to do is sign up and connect your bank account for the award! With commission-free crypto trading and the ability to set limit orders, it is a great hybrid offering in my opinion! Not to forget the addition of wallets and the ability to send and receive crypto!


Unstoppable Domains

Sign up using my link here and get a free $10 credit towards your first $40+ purchase!


How do you rate this article?



Graduated from Texas A&M in May of 2020 had dabbled in crypto since 2017 but dove in at the end of 2019. December of 2020 packed up and moved to D.C.! Huge sports fan, space nerd, and international newsreader! Follow me on Twitter @Cje95_

Chronic Illness and Crypto
Chronic Illness and Crypto

Cryptocurrency and Blockchain are going to be a huge part of the future and no matter who tries it isn't going to be stopped! Here I try to give my best insight and thoughts into the latest crypto news, features, developments. Further, I look to discover any link to news from the United States ranging from social-political issues to stock market and economic data.

Send a $0.01 microtip in crypto to the author, and earn yourself as you read!

20% to author / 80% to me.
We pay the tips from our rewards pool.