FUD Alert: Binance Acknowledge This Mistake In Customer Funds

As per the Bloomberg report, Cryptocurrency exchange Binance has admitted that it has mistakenly stored collateral for some of its tokens in the same wallet as the exchange’s customer funds.

Details About The Error?

Binance-peg tokens or B-Tokens are currently stored in a single wallet called ‘Binance 8’ which also holds customer assets. It was reported that, on Monday, as per the listings visible on its website, the wallet contains significantly more tokens in reserve than required for the amount of B-tokens issued by Binance.

This suggests that the collateral is mixed with the customer’s coins and not stored separately.

Binance Is Fixing This Mistake

Binance spokesperson in a statement to Bloomberg News said that “Binance 8 is an exchange cold wallet. Collateral assets have previously been moved into this wallet in error and referenced accordingly on the B-Token Proof of Collateral page.” It was further added that Binance is aware of this error and is in the process of moving these assets to a dedicated collateral wallet.

The spokesperson mentioned that user assets held with the exchange are backed 1:1. However, the Binance spokesperson did not disclose when the issue was identified. Currently, Binance 8 is the 6th largest wallet with over $2.35 billion worth of total crypto holdings.