The character of

The character of "The Down Game" criticized the audit of bitcoin exchanges

Subscribe

The character of "The Down Game" criticized the audit of bitcoin exchanges

Michael Bury, the investor who predicted the mortgage crisis of 2007, called audits of cryptocurrency exchanges' balance sheets by audit firms meaningless.

Data: Twitter.
"It's a problem. When I started using a new kind of credit default swap in 2005, our auditors were learning on the fly. It's not very good. The same goes for FTX, Binance and others. Auditing is essentially meaningless," Bury wrote.

That's how the investor commented on the news that the French auditor Mazars stopped serving cryptocurrency companies.

Earlier, the firm conducted an audit of the reserves of the Crypto.com platform and the bitcoin balances of the Binance exchange.

After the publication of the report on the latter, experts said that it was not convinced about the safety of users' assets. In their opinion, Mazars' work with the exchange was not a full-fledged audit.

John Reed Stark Consulting president John Reed Stark said that as a former SEC employee, he saw "red flags" in the results of the audit.

Binance faced a significant outflow of funds after the criticism of the report. The exchange also had problems withdrawing USD Coin Stablecoin (USDC) in some networks.

Against this background, the head of Binance Changpeng Zhao was forced to refute rumors about a lack of liquidity on the platform.

CryptoQuant experts confirmed the data in the Mazars report about the exchange's bitcoin liabilities and reserves.

Bury was one of the first to predict the collapse of the U.S. mortgage lending market. He put all the money of the hedge fund he founded, Scion Capital, against CDO mortgage bonds and managed to make money on the crisis.

In 2015, the American writer and journalist Michael Lewis's book describing the events of those days was used as the basis for the movie "Lowdown Game.

Other news

Investing: Five altcoins with the highest growth potential
Reuters: Animoca Brands has lowered fundraising for Web3 to $800 million
Tether estimates first-quarter 2023 earnings at $700 million
U.S. prosecutors indicted Terraform Labs founder on eight counts
Bitcoin mining difficulty increased by 70% in a year
The hype over Arbitrum's airdrop brought down the project's website