Binance Responds to Forged Legal Letter, Rejects Insolvency Accusations
- Binance denied the issuance of a cease-and-desist letter related to the spread of bankruptcy rumors.
- The exchange explained that the viral document was a forgery circulating on social media platforms.
- Binance denied allegations of bankruptcy and insolvency, stating that it issued no cease-and-desist letters.
Binance denied any connection to a viral cease-and-desist letter related to allegations of insolvency and bankruptcy. These rumors were spreading around the social media platforms. The exchange explained that the viral document was a forgery circulating on social media platforms.
The rumors about the financial stability of Binance started when a person on the X form posted that Binance was insolvent and would cause a huge impact on the market. The person posted a cease-and-desist letter, threatening to take legal action if the post was not removed.
Exchange Response to False Document
Binance responded to the false document through their official customer support services. This is where the exchange stated that the cease-and-desist letter “is not from Binance”. And that users should be wary of false documents and misinformation. The exchange made it clear that it has not issued any legal warnings regarding the bankruptcy rumors or requested the removal of content.
In addition to the response to the false document, Binance also responded to the bankruptcy rumors linked to the viral documents. Binance reiterated these as baseless and that the exchange is operating in a financially stable manner.
With the emergence of the rumors, some users began campaigns encouraging users to withdraw their funds from Binance to self-custody wallets. Binance co-founder Yi He responded to the withdrawal campaigns, where she stated that stress testing is a normal process through regular withdrawals. But the on-chain data indicated that asset balances had increased.
Market Response Over Claims
The adoption of fake documents in the crypto space may be one of the elements that instill fear, uncertainty, and doubt (FUD). Binance’s response to the fake cease-and-desist letter was aimed at countering misinformation that may have led to unnecessary asset price movements. This approach to misinformation has been employed in previous market cycles and has used social shares to induce market volatility.
Despite Binance’s response to the fake cease-and-desist letter, the original posts are still available. It highlights the challenges faced by them. Through the announcement andits continued rejection of claims, it aims to address misinformation and prevent misleading information that may influence market behavior.
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