Binance.US transferred $400m to trading firm managed by CZ

On Feb 17, 2023

Binance transferred more than $400 million from the Binance U.S. account in Silvergate Bank.
Interestingly, Binance CEO Changpeng Zhao is named as the manager in the company’s documents.

A recent report by Reuters revealed that Binance reportedly transferred millions of dollars from its partner exchange in the United States to a private trading firm.

As per the report, the world’s largest exchange had access to the bank accounts of Binance U.S. which has repeatedly claimed that it is a separate entity.

Funds were transferred to a firm managed by Changpeng Zhao

According to bank records viewed by Reuters, Binance transferred more than $400 million from Binance U.S. account in Silvergate Bank based in California to a private trading firm called Merit Peak Ltd.

These transactions took place in the first three months of 2021. The transfers to Merit Peak reportedly began in 2020. Interestingly, Binance CEO Changpeng Zhao is named as the manager in the company’s documents.

Bank records further revealed that in the first quarter of 2021, Binance U.S. received $650 million from a firm named Prime Trust LLC.

As per the exchange’s terms of use at the time, Prime Trust was a custodian firm that held a portion of the funds deposited by the crypto exchange’s customers.

While it is unclear whether Merit Peak received funds from customer deposits, the transfer from Prime Trust indicates that the concerned Binance account received funds from an account that held customer deposits.

Binance U.S. CEO had no knowledge of the transfers

As per company messages seen by Reuters, the executives of Binance U.S. were concerned about the outflow of funds. CEO Catherine Coley reportedly had no knowledge of these massive transactions that transferred hundreds of millions out of her company’s bank account. In one particular message, Coley described the transfers as “unexpected” saying that “no one mentioned them.”

It is interesting to note that following the $400 million transfer to Merit Peak, a portion of the funds were sent to a Seychelles-based firm called Key Vision Development Limited. A corporate filing from 2021 revealed that Changpeng Zhao was the director of the firm at the time.

In response to the sensational report by Reuters, Binance U.S. clarified that only the employees of the American crypto exchange had access to its bank accounts. The response further stated that Merit Peak had ceased all activity on the exchange in 2021.

This article originally appeared here.