It’s been a year of ups and downs for Malta-based cryptocurrency exchange Binance. The exchange has been hacked, losing 7,000 bitcoin belonging to its customers, it has been plagued by a data breach which led to the personal details of its customers being shared online, and it has faced a barrage of questions about the way it conducts its quarterly token burns.
Problems were compounded last week after it was revealed that the figures around the exchange’s ninth token burn just didn’t add up.
To recap, Binance has been conducting these quarterly burns since 2017, in an effort to drive up the price of its native token, Binance Coin (BNB).
But last week’s burn has customers and investors confused, as it appears to directly contradict and challenge the numbers published in its own white paper.
The ninth burn led to just over two million tokens being burnt off, valued at close to $37 million.
Added to the previous burns this meant in total 14,525,135 BNB have now been burnt since the process began in 2017.
In its announcement of the burn, Binance said this left 185,474,865 BNB remaining.
However, a few more lines into the announcement, links were included to show the burn had been completed.
Clicking on the links it doesn’t take a detective to find the burn wallet address, and to see that it contains 48,461,323 BNB.
Add the remaining BNB together, and the exchange seems to have 233,936,188 BNB tokens remaining, despite its white paper clearly stating only 200 million will ever be created.
So what gives, and just what is going on? You’d expect an exchange in charge of billions of dollars of customers money would have a basic grasp of math, right?
This is not the first time that questions have followed one of Binance’s quarterly burns.
In June, following the eighth burn, He-Yi one of the exchange’s co-founders was forced to take to Chinese social media giant weibo to defend a change in the method that Binance had used to conduct the burn.
Instead of burning 20 per cent of tokens in circulation, the exchange took the decision to burn the portion of BNB that had been allocated to the Binance executive team.
This led many investors to claim that the move would destabilize and devalue the BNB token in the long run.
It’s clear with just a couple of months of 2019 left, Binance could well be facing an even more turbulent 2020.