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Mazars Pauses Work on Crypto Clients

S.J. Steinhardt
Published Date:
Dec 16, 2022


Mazars has paused work on all cryptocurrency clients, including Binance, the world’s largest crypto exchange, multiple news organizations reported.

The audit, tax and advisory firm had been conducting a “proof of reserves” report for Binance and other crypto companies. These limited attestations, which are not as thorough as a full audit, are intended to assure investors of a business’s solvency.

“Mazars has indicated that they will temporarily pause their work with all of their crypto clients globally, which include, KuCoin and Binance,” a Binance spokesperson said. “Unfortunately, this means that we will not be able to work with Mazars for the moment.”

Mazars’s report on Binance’s bitcoin assets and bitcoin liabilities, published last week, consisted of a five-page letter from the firm’s South African affiliate. Mazars did “not express an opinion or an assurance conclusion,” the Wall Street Journal quoted the letter as saying.

Binance incurred $6 billion in outflows in the past week. The crypto exchange market has been shaken by the collapse of FTX and by the high-profile failings of other crypto companies, such as Voyager Digital, Three Arrows Capital and Celsius Network.

Mazars said 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,” according to the Financial Times (FT).

Binance said that it has “reached out to multiple large firms, including the Big Four, who are currently unwilling to conduct a proof of reserve for a private crypto company and we are still looking for a firm who will do so,” the FT reported.

Proof of reserves reports are “better than nothing,” Esther Mallowah, head of tech policy at the ICAEW, a global professional body for chartered accountants, told Bloomberg, “but I don’t think they provide the complete picture that investors need.”

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