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Binance’s Billions are Backed, but You’re Probably Asking the Wrong Question



Binance’s Billions are Backed, but You’re Probably Asking the Wrong Question

The crypto industry is obsessed with figuring out if digital assets are actually backed by anything, but they should be careful what they wish for, they might actually find out.

Inthe wake of FTX’s spectacular collapse, amidst a hailstorm of fraud and mismanagement allegations, focus was naturally switched to the world’s largest surviving cryptocurrency exchange that was still standing—

Over the course of several days, a whopping US$6.4 billion worth of cryptocurrencies and stablecoins were withdrawn from, more or less seamlessly, save for hiccups with respect to the stablecoin USDC, but otherwise, with little issue.’s ability to satisfy any withdrawals out of its exchange helped to assuage concerns over its solvency and that depositor assets were fully backed, leading to net inflows to the exchange in recent days.

But are investors and traders asking the right questions?

Backed Against the Wall

Since the first Tether (a dollar-denominated stablecoin) was minted, questions have been raised ever since about the true circumstances backing a stablecoin or cryptocurrency.

For an industry founded on the decentralized ethos of Bitcoin, that obsession with backing has always been somewhat peculiar — if the value of a cryptocurrency is its consensus mechanism (a shared agreement that the token is of value), then why this fixation with whether or not a token is backed?

The main issue of course is that consensus isn’t a static construct and it manifests itself through the price mechanism.

Price equilibrium is a reflection of consensus, albeit an imperfect one, and as any trader will attest, a fleeting circumstance.

As such, stablecoins such as Tether, were born of that desire to achieve some form of equilibrium within the cryptocurrency markets, a brief respite in a vast ocean of volatility, and with it, the desire to make sure that equilibrium was more actual than perceived.

But They Seem Legit

As evidenced by the experience with FTX, cryptocurrency traders have long run the gauntlet of centralized exchanges, judging them more on marketing and the personalities who led them, instead of demanding full audits and greater transparency.

The absence of a global regulatory framework to govern cryptocurrency exchanges hasn’t helped transparency or investor protection either, with the world’s biggest exchanges regularly plying the unsavory trade of regulatory arbitrage with impunity.

And that brings us to, an exchange which in the aftermath of the FTX collapse could possibly have come out to set industry best practices, but instead has raised more questions than were even asked.

It would be naïve to associate centralized cryptocurrency exchanges with a strong desire to be regulated.

Outside of perhaps the listed U.S. cryptocurrency exchange Coinbase and its competitor Gemini, the world’s biggest exchanges have often chosen to domicile themselves in jurisdictions with “light touch” regulation, to manage their affairs away from the prying eyes of perhaps more zealous regulators in global financial centers.

But the long arm of the law reaches out to even the most far flung locales, which is why both FTX and had localized, sanitized versions in major jurisdictions, which have long been suspected of serving as red herrings to throw regulators off the scent of what was really going on behind the scenes.

As recently as October 2022, Reuters uncovered proof that incorporated its U.S. entity to serve as a decoy for regulators to chew at, a strategy that the cryptocurrency exchange is believed to have long employed to always stay one step ahead of regulators.

And while entities such as Binance.US and Binance France remain highly visible, few even know where the exchange that matters — is actually domiciled (most likely the Cayman Islands).

Transparency for Thee But Not For Me is privately held, and so it is under no obligation to disclose even the most basic financial information, not its revenue, profit, cash reserves, or balance sheet.

While, just like FTX, issues its own token, BNB, it doesn’t reveal what role BNB plays on its balance sheet. also lends customers money against their cryptocurrencies, allowing them to take ludicrous amounts of leverage (up to 125 times) and trade on margin, but without revealing how big those bets are, how exposed the exchange is to that risk nor its ability to finance withdrawals.

Because hasn’t had to raise outside funding since 2018, it also hasn’t had to share financial information by way of pitch decks to venture capitalists either.

As black boxes go,’s appears to be hermetically sealed and attempts to at least have some semblance of external validation are meeting stiff resistance.

In recent days, accounting firm Mazars indicated that they would be temporarily halting work for cryptocurrency clients globally, including for, which was a client.

Having the accountant quit on just as investigators from the U.S. Department of Justice are circling is not a good look, and the timing could not be more inconvenient.

Yet even if Mazars hadn’t quit on, it’s less clear what the value that work (if any) was.

Mazars had been tasked with examining just the Bitcoin holdings of as they existed at the end of one day in November and in a December 7 report, the accounting firm reported that just’s Bitcoin holdings alone exceeded its customer Bitcoin liabilities.

Although claimed the report to be an audit, Mazars clarified that it was an “agreed-upon procedures engagement” and was “not an assurance engagement.”

But audits in and of themselves are not silver bullets.

Even when auditors have been called in to inspect the books in other cases, that hasn’t stopped grifters from grifting.

Take Arif Naqvi’s Dubai-based private equity firm The Abraaj Group for instance, which collapsed under an avalanche of fraud and misuse of funds and which had one of its funds audited by “Big Four” accounting firm KPMG.

At the time, Naqvi moved money around various funds under control of The Abraaj Group so that when auditors at KPMG inspected the bank accounts of the fund in question, it appeared that the monies were present, only to be spirited away the very next day.

Such is the limitation of asset “snapshots” which do little other than to quell any momentary queasiness as to the solvency or integrity of a firm’s balance sheets.

Short of a full scale audit of, few outside of Changpeng Zhao or CZ as he is better known, and several other members of his inner circle, are likely to have a holistic view of what is under the hood of a cryptocurrency exchange that is said to do trillions in trading volume annually.

It also doesn’t help that recently Mazars took down the webpage containing its report on’s Bitcoin reserves “due to concerns regarding the way these reports are understood by the public.”

But whether has all of the reserves it says it has, isn’t necessarily the biggest issue for investors, but what the quality of those reserves actually is.

And that analysis requires investigation of a little-known stablecoin — TUSD.

Minor Stablecoins — What the deuce?

If you’ve never heard of TrueUSD or TUSD, that’s probably because you’ve not needed it.

Created in 2018, TUSD is a dollar-backed stablecoin issued by TrustToken, but with an interesting feature — the name on the bank account that TUSD could be redeemed to would also need to be the same name held with your TrustToken account.

And for convenience, the good people at TrustToken made sure that the Ethereum wallet addresses used at TrustToken were extremely simple to recall with plenty of 0s.

But which were the banks that were allowing the receipt of TUSD proceeds into their accounts?

Because most banks would close bank accounts linked to large cryptocurrency transactions, it was only a select clutch of banks that were willing to process TUSD redemptions.

And who redeemed that TUSD will raise no shortage of eyebrows as revealed by the excellent research from DataFinnovation.


Over 70% of all TUSD redemptions were conducted by just 4 parties, with Alameda Research making the bulk of those redemptions at US$4.4 billion.

In the early days, Genesis Block, a Hong Kong-based company, facilitated millions and possibly billions of dollars worth of cash-for-crypto transactions, with lines running around the corner and the store closing on occasion having run out of coins to sell.

Independent research by Mike Burgersburg suggests that Genesis Block was essentially a front for Alameda Research, with the “hedge fund” then funneling transfers to its wallets out to a whole range of targets — not how a hedge fund wallet would typically be expected to behave.


Further research by DataFinnovation also revealed that the TUSD minted on was eventually funneled into USDT and redeemed via FTX into USD.

Which is where the connection between Binance, FTX, Alameda Research and Genesis Block converges — the group appeared to be actively involved in these transactions and sharing the same bank accounts to boot (recall that the redemption address ownership for TUSD had to match the bank account ownership).

Given that TUSD appears to have no real use case outside of these transfers from cash to cryptocurrencies for getting dollars back into the banking system, not much imagination is needed to figure out the “true” purpose of these transactions (pun intended).

But where that TUSD ends up is perhaps even more interesting — through a clutch of banks that were willing to off ramp TUSD transactions.

The availability of these banking relationships allowed FTX and to facilitate transfers from cash-to-crypto and back into the banking system, a strategy that worked well for the two exchanges.

Unlike FTX though, went about its business quietly, and when its U.S. entity was fined US$241,000 by State of Ohio for US$138 million in illegal transfers, proceeded to apply for a money transmission license the very same day.


By September 28, 2020, went ahead to apply for a money transmitter license, with evidence that BAM Trading Services Inc., a entity, had been engaged in transactions from as early as 2019, with such transactions denominated solely in cryptocurrencies.

Be Careful What You Wish For

The collapse of FTX is only the tip of the iceberg and even though may have accelerated the destruction of its rival cryptocurrency exchange through its purported sale of FTT tokens, the investigation of FTX will no doubt uncover just how close the two rivals once were.

And that may be where things become altogether too interesting for

From as early as 2018 and as reported by Reuters, the U.S. Department of Justice had been investigating for evading and contravening U.S. anti-money laundering laws and sanctions.

It was uncovered earlier in 2022 that laundered as much as US$8 billion for Iranian firms, in contravention of sanctions.

A history of interesting transfers between’s U.S. entities and links to TUSD as well as the cash-for-crypto transactions involving Genesis Block uncovered from the implosion of FTX is now inviting even more attention on, which it would clearly rather avoid.

Ostensibly FTX and may have been bitter rivals, but recall that at one time, the latter had invested a whopping US$2.1 billion in the former, cementing just how close the two entities once were.

The two “rival” exchanges even shared bank accounts for off-ramping TUSD where convenient.

And while U.S. prosecutors may be divided over whether now is the time to commence legal action against, the implosion of FTX may provide them with unprecedented access to the records they need to make a case against the, given how intertwined the two exchanges were at one point in time.

Unlike FTX, has always insisted in utmost secrecy, using communication channels like Telegram with disappearing messages so as not to keep a record of conversations or correspondence, as reported by Reuters.

FTX insiders on the other hand communicated openly and even though they kept poor accounting records and had no risk management, communication records, emails, interviews and a treasure trove of information and documents on transactions, including banking, may help shed some light on involvement with

More significantly, as the wreckage of FTX is sifted through and if evidence is uncovered that facilitated money laundering or other forms of financial crimes, the ensuing actions by U.S. authorities may have major implications on deposits remaining with, not least of which is the freezing of any dollar-denominated accounts in the U.S. banking system.

Let’s not forget that not so long ago, Washington froze out Russia’s overseas dollar-denominated foreign reserves, in retaliation for the Kremlin’s invasion of Ukraine, even going so far as to target the Russian central bank.

Should be found to have committed money laundering or other heinous financial crimes, U.S. authorities are unlikely to flinch when tasked to freeze any dollar-denominated accounts that may be in the exchange’s control.

And therein lies the real question investors and traders continuing to run the gauntlet on should be asking.

It’s not that doesn’t have the dollars, it most likely does.

And it’s not that can’t facilitate withdrawals, it most likely can.

But those are the wrong questions.

If gets frozen or sanctioned by U.S. authorities, it won’t matter how many dollars or tokens it has backing the exchange, because they may be tainted and therefore, liable to be frozen.

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HCLTech and Cisco create collaborative hybrid workplaces




Cloud Computing News

Digital comms specialist Cisco and global tech firm HCLTech have teamed up to launch Meeting-Rooms-as-a-Service (MRaaS).

Available on a subscription model, this solution modernises legacy meeting rooms and enables users to join meetings from any meeting solution provider using Webex devices.

The MRaaS solution helps enterprises simplify the design, implementation and maintenance of integrated meeting rooms, enabling seamless collaboration for their globally distributed hybrid workforces.

Rakshit Ghura, senior VP and Global head of digital workplace services, HCLTech, said: “MRaaS combines our consulting and managed services expertise with Cisco’s proficiency in Webex devices to change the way employees conceptualise, organise and interact in a collaborative environment for a modern hybrid work model.

“The common vision of our partnership is to elevate the collaboration experience at work and drive productivity through modern meeting rooms.”

Alexandra Zagury, VP of partner managed and as-a-Service Sales at Cisco, said: “Our partnership with HCLTech helps our clients transform their offices through cost-effective managed services that support the ongoing evolution of workspaces.

“As we reimagine the modern office, we are making it easier to support collaboration and productivity among workers, whether they are in the office or elsewhere.”

Cisco’s Webex collaboration devices harness the power of artificial intelligence to offer intuitive, seamless collaboration experiences, enabling meeting rooms with smart features such as meeting zones, intelligent people framing, optimised attendee audio and background noise removal, among others.

Want to learn more about cybersecurity and the cloud from industry leaders? Check out Cyber Security & Cloud Expo taking place in Amsterdam, California, and London. Explore other upcoming enterprise technology events and webinars powered by TechForge here.

Tags: Cisco, collaboration, HCLTech, Hybrid, meetings

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Canonical releases low-touch private cloud MicroCloud




Cloud Computing News

Canonical has announced the general availability of MicroCloud, a low-touch, open source cloud solution. MicroCloud is part of Canonical’s growing cloud infrastructure portfolio.

It is purpose-built for scalable clusters and edge deployments for all types of enterprises. It is designed with simplicity, security and automation in mind, minimising the time and effort to both deploy and maintain it. Conveniently, enterprise support for MicroCloud is offered as part of Canonical’s Ubuntu Pro subscription, with several support tiers available, and priced per node.

MicroClouds are optimised for repeatable and reliable remote deployments. A single command initiates the orchestration and clustering of various components with minimal involvement by the user, resulting in a fully functional cloud within minutes. This simplified deployment process significantly reduces the barrier to entry, putting a production-grade cloud at everyone’s fingertips.

Juan Manuel Ventura, head of architectures & technologies at Spindox, said: “Cloud computing is not only about technology, it’s the beating heart of any modern industrial transformation, driving agility and innovation. Our mission is to provide our customers with the most effective ways to innovate and bring value; having a complexity-free cloud infrastructure is one important piece of that puzzle. With MicroCloud, the focus shifts away from struggling with cloud operations to solving real business challenges” says

In addition to seamless deployment, MicroCloud prioritises security and ease of maintenance. All MicroCloud components are built with strict confinement for increased security, with over-the-air transactional updates that preserve data and roll back on errors automatically. Upgrades to newer versions are handled automatically and without downtime, with the mechanisms to hold or schedule them as needed.

With this approach, MicroCloud caters to both on-premise clouds but also edge deployments at remote locations, allowing organisations to use the same infrastructure primitives and services wherever they are needed. It is suitable for business-in-branch office locations or industrial use inside a factory, as well as distributed locations where the focus is on replicability and unattended operations.

Cedric Gegout, VP of product at Canonical, said: “As data becomes more distributed, the infrastructure has to follow. Cloud computing is now distributed, spanning across data centres, far and near edge computing appliances. MicroCloud is our answer to that.

“By packaging known infrastructure primitives in a portable and unattended way, we are delivering a simpler, more prescriptive cloud experience that makes zero-ops a reality for many Industries.“

MicroCloud’s lightweight architecture makes it usable on both commodity and high-end hardware, with several ways to further reduce its footprint depending on your workload needs. In addition to the standard Ubuntu Server or Desktop, MicroClouds can be run on Ubuntu Core – a lightweight OS optimised for the edge. With Ubuntu Core, MicroClouds are a perfect solution for far-edge locations with limited computing capabilities. Users can choose to run their workloads using Kubernetes or via system containers. System containers based on LXD behave similarly to traditional VMs but consume fewer resources while providing bare-metal performance.

Coupled with Canonical’s Ubuntu Pro + Support subscription, MicroCloud users can benefit from an enterprise-grade open source cloud solution that is fully supported and with better economics. An Ubuntu Pro subscription offers security maintenance for the broadest collection of open-source software available from a single vendor today. It covers over 30k packages with a consistent security maintenance commitment, and additional features such as kernel livepatch, systems management at scale, certified compliance and hardening profiles enabling easy adoption for enterprises. With per-node pricing and no hidden fees, customers can rest assured that their environment is secure and supported without the expensive price tag typically associated with cloud solutions.

Want to learn more about cybersecurity and the cloud from industry leaders? Check out Cyber Security & Cloud Expo taking place in Amsterdam, California, and London. Explore other upcoming enterprise technology events and webinars powered by TechForge here.

Tags: automation, Canonical, MicroCloud, private cloud

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AWS and SoftwareOne collaborate on RISE with SAP




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Amazon Web Services (AWS) and SoftwareOne Holding AG, a global provider of end-to-end software and cloud technology solutions, have partnered to help customers transition to RISE with SAP on an AWS cloud environment.

Called the Ready for RISE on AWS bundle, it combines SoftwareOne’s deep SAP advisory and implementation knowledge with AWS technologies to expedite a client’s SAP transformation journey.

The collaboration comes at a time when there is growing pressure on organisations to decide how to modernise their SAP environments driven in part by the end of mainstream support for SAP ERP Central Component (SAP ECC) in 2027. Despite the imminent deadline, many organisations are still confused as to which path to take, including when to adopt RISE with SAP, SAP’s bundled offering of cloud solutions, infrastructure, and services that helps migrate SAP ERP to the cloud.

Ireneusz Hołowacz, Director of Application Development Center at GAVDI Polska, said: “A stable, efficient, and cost-effective environment for consultants and programmers is one of the most important priorities of our daily work. Thanks to the migration of our SAP systems to the AWS cloud with the help of SoftwareOne, GAVDI Polska has achieved all the goals set for this process.

In a survey recently conducted by SoftwareOne with Americas’ SAP Users’ Group (ASUG) – the full details of which will be revealed in January 2024 – showed that while 42% of respondents were familiar with RISE with SAP, 40% had heard of it but weren’t familiar with the details and 18% had never heard of it. Over half (52%) said they were still unsure how RISE with SAP would impact their existing relationship with cloud service providers.

“SAP customers have implemented some of the most comprehensive and complex enterprise systems in the industry and moving them to cloud services like AWS requires many important decisions to be made to optimise these investments,” says Joshua Greenbaum, Principal at EAC. “SoftwareOne’s extensive experience in the SAP ecosystem, combined with its unique capabilities around system rationalisation, cost containment, contracts and licenses, and cloud service management, among others, will provide customers deploying on AWS with the ability to make the most of RISE on SAP and other SAP offerings. Ready for RISE on AWS is an important offering for SAP customers at this critical moment in their business transformations.”

The Ready for RISE on AWS bundle will help clients understand their SAP transformation options and offer a comprehensive solution to organisations who consider RISE with SAP. It includes advisory data preparation, conversion services, data and AI, cloud innovation platform, supporting the entire journey to RISE on AWS. Clients will benefit from accelerated Return on Investment (ROI), optimal data management, and cost-saving strategies while laying the foundation for ongoing innovation and long-term business success.

Matt Schwartz, worldwide director, SAP Alliance & Partner Network at AWS, said: “As a valued AWS Premier Consulting Partner, AWS is working closely with SoftwareOne to offer SAP customers comprehensive assistance through each step of their journey to RISE with SAP on AWS.  SoftwareOne’s ability to bundle Advisory, Data & AI, Cloud Platform, and Operations considerations can be of high interest to customers who are seeking to understand RISE with SAP as well as the cloud native and operation considerations that surround and support the RISE with SAP construct.”

PF Grillet, SAP Business Lead at SoftwareOne, said: “There are many choices available to SAP clients who know they need to modernise but aren’t sure of the best option, particularly given the business-critical nature of the applications.

“All of our services are centered around our customers and what is right for them. This includes supporting and optimising RISE with SAP in scenarios when it’s the right decision based on their requirements. Our extensive knowledge of and relationship with AWS means we can help them better prepare and achieve a seamless transition to S/4HANA using RISE with SAP on AWS with reduced costs and risks. This collaboration goes beyond preparing businesses for change; it’s making transformation and becoming innovation-ready a reality using AWS technologies.”

The offering includes SNP tooling to reduce a customer’s data footprint and accelerate migration. SoftwareOne will migrate selected data to an AWS data lake, accelerate innovation readiness and ensure SAP data is suitable for broader data analytics and AI use cases. Clients gain access to innovative tools like AWS’ Sagemaker for Machine Learning, continuous data management and optimisation within the AWS environment. The AWS innovation platform also includes Amazon Bedrock that helps organisations accelerate adapting Large Language Models and deploying GenAI use cases that leverage the extended data set.

“While the future innovation opportunities are exciting, clients need to balance these with a pragmatic approach to costs,” explained Marilyn Moodley, Country Leader for South Africa and WECA at SoftwareOne, “We integrate ‘Cost-Out’ recommendations into the core of our services, providing a more cost-effective solution for customers, like reducing the data footprint size and optimising storage and archiving.

“Our expertise in the complexities of SAP licensing further drives cost savings while our FinOps capabilities enable customers to optimise their AWS cloud spend and effectively manage their AWS cloud environment, ensuring full transparency in their budgets. The overall result is a significantly reduced time for RISE migration, which translates into a quicker time to value.”

Want to learn more about cybersecurity and the cloud from industry leaders? Check out Cyber Security & Cloud Expo taking place in Amsterdam, California, and London. Explore other upcoming enterprise technology events and webinars powered by TechForge here.

Tags: AWS, partnership, SAP, SoftwareOne, transition

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