Binance moved $400 million from bank account of a US partner to a firm managed by CEO Zhao via a secret access

Crypto giant Binance can’t seem to shake off the rumors and speculations surrounding the company. Early this month, Binance temporarily suspended U.S. dollar deposits and withdrawals, the world’s largest crypto exchange said in a tweet, without providing a reason for the decision.

Fast forward ten days later, Reuters is now reporting that Binance had moved $400 million from a U.S. partner to a firm managed by CEO Changpeng Zhao. In an exclusive report this evening, Binance had secret access to a bank account belonging to its purportedly independent U.S. partner and transferred large sums of money from the account to a trading firm managed by Binance CEO Changpeng Zhao, Reuters said, citing banking records and company messages seen by the publication.

According to records for the quarter reviewed by Reuters, more than $400 million flowed from the Binance.US account at California-based Silvergate Bank to this trading firm, Merit Peak Ltd in the first three months of 2021. The records further show that the Binance.US account was registered under the name of BAM Trading, the U.S. exchange’s operating company. The company messages also show that the transfers to Merit Peak began in late 2020.

The publication could not determine the reason for the transfer or whether any of the funds belonged to Binance.US customers. However, the bank records show that “the exchange’s public terms of use at the time said its customers’ dollar deposits were held at Silvergate and a Nevada-based custodian firm called Prime Trust LLC. Prime Trust made $650 million in wire transfer deposits into the Binance.US account during the quarter, ” Reuters wrote.

In response to Reuters’ questions, a Binance.US spokesperson, Kimberly Soward, did not address the questions about the transfers detailed in the bank records. However, in a statement, she said Reuters’ reporting used “outdated information” without elaborating further. She added:

“Merit Peak is neither trading nor providing any kind of services on the Binance.US platform” and “only Binance.US employees have access” to the bank accounts of the U.S. company. Soward didn’t specify when Merit Peak’s activities ceased.

Binance has been under public scrutiny since the collapse of the crypto exchange FTX. In a January 12 blog post, FTX founder Sam Bankman-Fried blamed Binance CZ’s ‘fateful tweet’ for the collapse of FTX.

“Then came CZ’s fateful tweet, following an extremely effective months-long PR campaign against FTX–and the crash. <…> But the November crash was a targeted attack on assets held by Alameda, not a broad market move,” Bankman Fried said.

Founded in 2017 by Changpeng Zhao and Yi He, the Cayman Islands-based Binance is the world’s leading blockchain ecosystem and cryptocurrency infrastructure provider with a financial product suite that includes the largest digital asset exchange by volume. It provides a platform for trading various cryptocurrencies. Binance also provides access to exchange digital currency pairs on the market while maintaining security, and liquidity, enabling a safe and efficient deal with anyone, anytime and anywhere.

Binance platform is used by millions worldwide, the Binance platform is dedicated to increasing the freedom of money for users and features an unmatched portfolio of crypto products and offerings, including trading and finance, education, data, and research, social good, investment and incubation, decentralization and infrastructure solutions, and more.