Binance’s Custodial Holdings Exceed $100B in User Assets

Crypto exchange Binance seems to have weathered the storm caused by the U.S. Department of Justice’s actions against the exchange and its co-founder Changpeng Zhao. Despite these challenges, Binance’s assets under custody have exceeded $100 billion as of March 18, according to the latest announcement. This represents a significant increase from the $40 billion recorded at the start of the year. Binance assures its users that their funds are kept at a 1:1 ratio, with additional reserves that can be verified through the exchange’s proof-of-reserves (POR) system. The recent surge in digital asset prices has undoubtedly contributed to the growth in user assets under Binance’s custody.
Binance’s proof-of-reserves currently displays collateralization ratios over 100% for major cryptocurrencies and altcoins. However, experts caution that proof-of-reserves only provides partial information on reserves and does not consider an entity’s liabilities when calculating net equity. Despite this, Binance’s CEO, Richard Teng, claims that the exchange is “debt-free” in terms of its capital structure. The exchange also announced its decision to sever ties with Binance Labs, its venture capital arm, on March 12. Despite Binance Labs’ successful track record, averaging over 14 times returns on invested projects and boasting a $10 billion portfolio, the exchange clarified that Binance Labs is independent and has no affiliation with the cryptocurrency exchange. In related news, the class-action lawsuit against Binance has had its dismissal reversed by an appeals court.