Binance Auditor Mazars Group Cuts Ties, BNB Price Tanks Nearly 15%

On Friday, December 16, Binance auditor Mazars Group announced that they decided suspend activity with all of its crypto clients. This development comes within two weeks of the Mazars Group publishing the Proof-of-Reserves report for Binance.

Along with Binance, the Mazars Group has also cut ties with some of its other clients like crypto.com and KuCoin. Several crypto market players had called the Proof-of-Reserves by Mazars Group as opaque and added that it doesn’t reveal the complete financial health of the exchange.

Explaining the reason behind suspending the ties with crypto firms, Mazars Group said that it had “paused its activity relating to the provision of Proof of Reserves Reports for entities in the cryptocurrency sector due to concerns regarding the way these reports are understood by the public”.

The accounting and auditing firm also said that its proof of reserves reports were in “accordance with Reporting Standards relevant to an Agreed Upon Procedures report”. Mazars’ Group report noted: “They do not constitute either an assurance or an audit opinion on subject matter. Instead they report limited findings based on the agreed procedures performed on the subject matter at a historical point in time”.

Binance has also confirmed the suspension of its ties with Mazars Group. One of the spokespersons for the exchange noted: “Unfortunately, this means that we will not be able to work with Mazars for the moment”.

Crypto exchange Binance has come under pressure from all ends as customers demand for a clear auditing of user assets. The implosion of crypto exchange FTX had led to more caution among crypto investors.

In an interview with CNBC earlier this week, Binance chief Changpeng Zhao said that they are working with more auditing firms, without naming them. However, he stated that several audit firms are scared to work with crypto businesses. “There are a few audit firms that audited FTX and they got burned because they give the stamp of approval, and I don’t know how they did the audits. But audits don’t reveal every problem,” continued Zhao. Besides, he also added that audit firms really don’t know to audit crypto exchanges, user assets and blockchains.

Besides, amid the recent surge in withdrawals at Binance, CZ has been assuring investors that the exchange remains financially strong. So far, Binance has swiftly facilitated $4 billion in withdrawals over the last week.

Soon after the news of Mazars’ exit, the BNB price came crashing down on Friday dropping over 12%. Over the last week, Binance’s native crypto has tanked by over 20%.