In a bid to uphold transparency and bolster trust in the cryptocurrency industry, Binance, one of the leading cryptocurrency exchanges, recently released its latest proof-of-reserves (PoRs) report on August 1.
While this release aimed to shed light on the exchange’s crypto reserves, a spotlight turned toward the movement of its USD Coin (USDC) reserves, particularly during the time of Silvergate Bank’s collapse.
The ensuing discussion on platforms like X (formerly Twitter) has generated significant interest within the crypto community.
Binance’s most recent reserve audit offers a glimpse into the exchange’s crypto holdings, showcasing that it possesses ample crypto and cash reserves to cover user funds.
Notably, the snapshot demonstrates that Binance’s net balances for all assets surpass 100% of its customers’ net balances, indicating a robust financial position.
The focal point of interest centers around Binance’s USDC reserves, particularly during the tumultuous period of Silvergate Bank’s collapse.
Binance had begun the process of internally converting customer-held USDC to Binance USD in September. However, records indicate that during Silvergate’s fallout on March 12, Binance embarked on a significant transition, converting its USDC reserves into Bitcoin (BTC) and Ether (ETH).
On-chain analyst Aleksandar Djakovic’s observations have gained traction, revealing that Binance strategically purchased approximately 100,000 BTC and 550,000 ETH between March 12 and May 1.
This calculated move amounted to around $3.5 billion, coincidentally aligning with the surplus of USDC Binance had on hand.