Mazars, paralyzes work with all crypto companies and BNB collapses. Which is a blow to the industries.
Mazars, the international accounting firm that previously worked for former US President Donald Trump’s companies, has suspended all work for Binance and other cryptocurrency companies, according to a statement from Binance.
Mazars has indicated that it will temporarily stop working with all of its crypto clients globally, including Crypto.com, KuCoin and Binance. Unfortunately, this means that we will not be able to work with Mazars at this time.”
Speaking of partnering with another accounting firm, the Binance spokesperson said:
«We have contacted several large companies, including the big four, and they are currently not willing to do a PoR for a private cryptocurrency company, so we are still looking for a company to do so»
As a reminder, cryptocurrency exchange Binance earlier this month commissioned accounting giant Mazars to audit its cryptocurrency reserves. In particular, as reported by the Wall Street Journal, this company has been appointed as an auditor to perform third-party financial verification.
Mazars stops working with cryptocurrency companies
Indeed, a spokesperson for Mazars indicated that it “has ceased its activity in providing proof of reserve reports to entities in the cryptocurrency industry due to concerns about how these reports are interpreted by the public”.
In fact, Mazars’ pause comes amid the investigation, sparked by the collapse of FTX, into how these platforms store user funds.
French auditing firm Mazars Group has paused work for all crypto clients globally, according to crypto exchange Binance, which was a customer of the auditing firm. https://t.co/RJQeYIeaju— BNN Bloomberg (@BNNBloomberg) December 16, 2022
Therefore, many believe that problems can arise. Others believe the service’s shutdown may be the result of regulatory pressure.
“While people will speculate on the reasons for this change, it is likely that Mazars has realized that the backlash associated with performing a superficial reserve test for cryptocurrency companies is much worse than it is. They could get away with it.”
Mazars' official website shows they fully discontinued their "https://t.co/8DvL7rVsE8" website, dedicated to Crypto audits.— Tree of Alpha (@Tree_of_Alpha) December 16, 2022
This comes after Bloomberg reports that Mazars stopped doing Proof of Reserves for Crypto companies.
The auditors’ reports
As noted, Mazars released a proof-of-concept assessment of Binance’s reserves last week, reporting a 101% security ratio for 575,742 Bitcoins in net customer deposits per November 22.
Likewise, it also conducted an assessment of the test reserves of KuCoin and Crypto.com. Finding that the reserves of BTC, ETH, USDT and USDC on KuCoin were also oversized, while Crypto.com had 1:1 support from its own reserves.
Interestingly, both reports have been removed from the company’s website.
I conclude with this sentence from Changpeng Zhao:
“Every human being should have access to financial instruments, such as cryptocurrencies, which allow greater financial independence”.