According to Michael Burry, the veteran investor who inspired the movie ‘The Big Short’, audits of Binance and other crypto exchanges are “essentially meaningless” because the auditor doesn’t know how to deal with crypto.
According to Barry, this is the same problem he faced in 2005 when he started using “a new type of credit default swap”. He added that the auditors were “learning on the job” at the time, which was “not a good thing.”
“Same goes for FTX, Binance, etc. The audit is essentially meaningless,” Barry recently wrote on Twitter, sharing a screenshot of the news that global auditors Mazar will stop working with crypto companies,
reason to believe berry
While some are concerned about the move by Mazar and others to abandon their crypto work, Bari has reason to believe that auditors simply don’t understand crypto.
Perception aligns with Binance CEO changpeng zhao (CZ) said during CNBC interview Last week, where he pointed out that the major auditors are simply unfamiliar with crypto.
“Many audit firms are afraid to work with crypto businesses,” CZ said in the interview.
He added that the so-called ‘Big Four’ firms, a term that usually refers to PwC, Deloitte, EY and KPMG, “don’t even know how to audit crypto exchanges.”
So far none of the four firms have commented on CZ’s comments, but it is known that Deloitte prepares annual audited statements for Coinbase.
One key difference between Coinbase and Binance is that the former is a publicly listed company that is fully regulated in the US, while Binance operates offshore and serves a much larger global audience.
Watch an excerpt from CZ’s interview on CNBC below:
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