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The audit reports of crypto exchanges were anything but an audit, says Dan Ashmore

Coinjournal’s Dan Ashmore told CNBC that the audit reports by cryptocurrency exchanges were not really audited reports. The analyst pointed out that the reports only indicated the assets held by the exchanges and didn’t reveal the liabilities of the companies. Several exchanges, including Binance and OKX, have published their proof of reserve reports in the […]

The post The audit reports of crypto exchanges were anything but an audit, says Dan Ashmore appeared first on CoinJournal.

  • Coinjournal’s Dan Ashmore told CNBC that the audit reports by cryptocurrency exchanges were not really audited reports.

  • The analyst pointed out that the reports only indicated the assets held by the exchanges and didn’t reveal the liabilities of the companies.

  • Several exchanges, including Binance and OKX, have published their proof of reserve reports in the last few months.

Proof of reserves didn’t include liabilities

Dan Ashmore, a cryptocurrency analyst at Coinjournal, told CNBC in a recent interview that the audit reports by cryptocurrency exchanges were not entirely accurate.

Last month, accounting firm Mazars Group suspended all work with its crypto clients, including Binance, KuCoin and Crypto.com. When asked about the move, Ashmore said the move was a disappointing one for the crypto industry. He stated that;

“It is disappointing, but it is not surprising. When you look at those audit reports, they were anything but an audit. It was essentially a statement of reserves. But there was no mention of liabilities. It is not possible to do an audit without mentioning liabilities. These proof of reserves need to become proper audits.”

Ashmore added that third-party entities need to look at these centralised exchanges and make financial assessments. However, due to the lack of in-depth information, it is impossible to do so at the moment. 

Centralised exchanges continue to publish proof of reserves

Since the collapse of the FTX crypto exchange in November 2022, centralised crypto exchanges have been publishing proof of reserves to show their users that they have assets on their platforms.

Earlier this week, the OKX crypto exchange published a proof-of-reserves report. The report revealed that the exchange has a total of $7.5 billion worth of assets in reserves which do not include its native token, OKB.

The post The audit reports of crypto exchanges were anything but an audit, says Dan Ashmore appeared first on CoinJournal.

Source: CoinJournal: Latest Bitcoin, Ethereum & Crypto News

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4 bearish factors for Bitcoin this week

The Federal Reserve meeting scheduled on Wednesday may be hawkish for the dollar Bitcoin might give up some of its 2023 gains on a hawkish Fed All eyes are on the Fed’s view on inflation, growth, future interest rates, and quantitative tightening The Federal Reserve’s monetary policy decision is scheduled this week. It is the […]

The post 4 bearish factors for Bitcoin this week appeared first on CoinJournal.

  • The Federal Reserve meeting scheduled on Wednesday may be hawkish for the dollar
  • Bitcoin might give up some of its 2023 gains on a hawkish Fed
  • All eyes are on the Fed’s view on inflation, growth, future interest rates, and quantitative tightening

The Federal Reserve’s monetary policy decision is scheduled this week. It is the first time the FOMC (Federal Open Market Committee) meets in 2023, and the stakes are high for the US dollar.

Bitcoin has strengthened against the US dollar in January so far, in sync with other fiat currencies. Therefore, whatever the Fed decides on Wednesday will affect Bitcoin price too.

A hawkish Fed may turn up being bearish for Bitcoin. These are the four areas where the Fed may express its hawkishness: inflation outlook, growth outlook, interest rates level, and quantitative tightening.

Inflation outlook

The Fed is committed to bringing inflation to its 2% target. This is why it has raised rates so aggressively, so if the Fed says that inflation is embedded and upside risks remain, then the US dollar should move higher.

In this scenario, the market will bet that the Fed sees ongoing rate hikes as appropriate.

Growth outlook

The currency stance is that a sustained period of below-trend growth is likely. If the Fed changed its view and sees recession required to have a material impact on the inflation outlook, that would also trigger a sharp move higher in the dollar.

Interest rates

Ultimately, it is all about the interest rate level. The funds rate range has reached 4.25%-4.50%, and all eyes are on what the Fed does and says on Wednesday.

The base case scenario is that the Fed will hike by 25bp and says that ongoing interest rate increases are appropriate. Therefore, anything more than that should be bullish for the dollar and bearish for Bitcoin.

For example, the Fed might hike 50bp. This is a risk going into the meeting, especially considering that inflation is not backing down as fast as initially thought.

Quantitative tightening

The Fed currently shrinks the balance sheet at a pace of $95 billion/month. A decision to accelerate the balance sheet reduction would be very hawkish for the dollar.

The post 4 bearish factors for Bitcoin this week appeared first on CoinJournal.

Source: CoinJournal: Latest Bitcoin, Ethereum & Crypto News

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