It was my first job out of college, and I was required to wear a suit to rent cars. The job was not enjoyable. I worked long hours, had to wash cars by hand, and dealt with the public. The pay was shit, and I was miserable. But I was a competent worker. I showed up on time, upsold the optional insurance like I was supposed to, and followed orders like a good soldier.

At this particular company, they baited people like me with a carrot of career advancement. You started at the bottom and could climb to the top with hard work. I went along with it for one year when my career path hit an impassable roadblock.

I arrived in the office Monday morning, and my manager and area manager called me into the office. They were both men. They started asking me about what I had done over the weekend. Then, they asked me why I called my assistant manager, Katrina, and left an obscene message.

Completely taken aback, I explained how I had visited some friends over the weekend. We went to the Indian (Native American) casino, and I won money playing blackjack. I even bought a watch with my winnings which I was wearing that day.

They weren't buying it. In the voice message, they said I announced who I was and said some pretty nasty stuff. I asked them if I could hear the message. They said no, but that the person sounded exactly like me. I asked about the caller ID, and they said it came from a random number.

They didn't believe me. The female assistant manager didn't believe me. They said that she didn't feel comfortable being alone with me in the office. From that day forward, my career path at this company was destroyed. I never got a promotion and, shortly after that, left the company.

The Aftermath

I know who left the message impersonating me. But, just as I denied that I left the message, I'm sure he would have denied it if I confronted him.

I took away three main things from this incident over 20 years ago. First, I learned sometimes you don't need to commit a crime to be considered guilty. Second, I learned that interacting with women in a work environment is dangerous and that co-workers will set you up. And I realized that no matter how hard I worked, how often I showed up on time, and how much unnecessary insurance I sold, the corporation didn't give two shits about me.

In 2022, I'm getting deja vu about the last lesson. As crypto investors, we have had our money stolen by corporations on multiple occasions, and I am reminded that corporations don't give a shit about us.

Today, the largest crypto corporation by a country mile, Binance, is under fire. Fear is swelling that Binance CEO Changpeng Zhao's (CZ') empire may be built on an unstable foundation. Is this a case of wrongful accusations? Or is this another corporation ready to wreak havoc on ordinary people?

The Smoke

Multiple events have caused investors to fear Binance's reliability. CZ recently took down FTX after correctly identifying the risk of holding FTT tokens. This cost a lot of people a lot of money. If you've made it this far in the article, you lost money directly or indirectly from the fall of FTX.

In response, investors want to see proof of funds. Ironically, CZ has been the voice calling for this. So Binance released its audit. And investors didn't feel warm and fuzzy from the audit results.

On the contrary, investors began pulling their funds off of Binance. As a result, over $3 billion worth of crypto was removed in a single day. And why wouldn't they? Here's a clip from an article from pymnts.com sharing some of the flags.

The firm that undertook the exercise, Mazars, has stated they “make no statement regarding the appropriateness” of its work for the crypto exchange, adding that its report does not “express an opinion or an assurance conclusion.” The Mazars report only focused on Binance’s bitcoin holdings and liabilities. Still, it did not expand the scope of its audit to any of the many other cryptocurrencies held and traded on Binance.

“Had we performed additional procedures, other matters might have come to our attention that would have been reported,” the auditors wrote in their statement. It is hardly a reassuring conclusion for retail investors who trusted their money with the exchange or plan to.-PYMNTS

After being told that funds were safe on Celsius, Voyager, and FTX by their CEOs, the crypto community has learned that corporate crypto CEOs are about as trustworthy as traditional corporate CEOs. Hence, why keep funds on Binance when there is nothing to gain and only the potential of losing?

There's more FUD on Binance's plate.

The US Department of Justice (DOJ) is also putting a target on Binance's back. According to Reuters, the DOJ is deciding whether or not to file charges against Binance and CZ for unlicensed money laundering conspiracy, unlicensed money transmission, and criminal sanctions violations.

In response, CZ tweeted:

He implies that this attack on Binance is from writers on SBF's payroll.

Binance isn't helping its case.

A further lousy look for Binance is its decision to halt USDC withdrawals from the platform. There's no way of destroying confidence quicker than by not allowing customers to withdraw their funds, especially USDC, which is perceived as one of the safest crypto assets.

Binance is stating that this is due to a token swap. Nonetheless, this action shouldn't make any investors with funds on Binance gain confidence in the platform.

Why this may be a wrongful accusation

Fear and confidence in exchanges are currently at all-time lows since I've been in crypto (2017). Investors are learning that there is no good reason to keep their assets on centralized platforms. For many of us, it's like being extra cautious while driving after a car accident. So why should I retake the risk on Binance if I lost access to assets on FTX, Gemini Earn, Celsius, Voyager, or any other doomed platforms?

But, even though investors are removing their assets, Binance still has the reserves to provide them. While Binance didn't have the cleanest audit, its balance sheet has no glaring holes. If there were, everyone would be racing to get everything off the platform immediately.

And, unlike the FTX/Alameda relationship, CZ isn't running a hedge fund tied to Binance. Binance has been printing money for several years and has established itself. We don't read anything about political donations or conspiring with governments to create regulations.

In October, the Binance Smart Chain got attacked with a $570 million hack. However, Binance ensured everyone was made whole and handled the situation much better than other exploited platforms.

Why I think Binance is fine, but I'm still removing my assets

There's a slim chance of Binance facing the same fate as FTX and other doomed centralized crypto platforms in the foreseeable future. First, Binance saw more withdrawals following the Luna and the FTX crash. Today, Binance is even saying that deposits are picking back up.

Secondly, the BNB token isn't cratering. If the crypto community lost confidence in Binance, the BNB token would get hit extremely hard. However, we are still waiting to see that happening. Ironically, BNB is outperforming ETH and BTC during this bear market, only down 61% from its all-time highs.

Removing crypto from the platform is a little to no-risk choice for investors. But selling an asset representing the platform and its DeFi ecosystem has an opportunity cost, especially if that coin has outperformed competing crypto assets during the bear market.

At the same time, it should be noted that the FTT token performed well until the fraud was discovered. The FTT token held no real utility outside the FTX exchange, whereas BNB is the native token for the Binance Smart Chain. Transactions are still occurring on BSC as they usually do.

Nonetheless, I am removing most of my assets on the Binance platform to be safe rather than sorry. I staked a few coins on Binance, but I can easily stake them via decentralized finance and not rely on Binance's custody.

If Binance fails, DeFi will get smoked.

My confidence may be misplaced, and, like busted investors in FTX, I can't fathom the possibility of it being insolvent. However, if Binance fails and the BNB token crashes, it could cause irreparable damage to the DeFi ecosystem.

I see the Binance Smart Chain as DeFi for the ordinary person. Ethereum is built for white-collar DeFi users who can afford to pay dollars worth of ETH gas fees for transactions. Meanwhile, BSC is made for the working class. BSC does triple the transaction volume of Ethereum. Imagine the impact of all these DeFi early adopters getting wiped out because BNB pairings become worthless.

In other words, I need to display my confidence more because the alternative is too catastrophic to give strong consideration to happening.

Key Takeaways

Ironically, the centralized players are providing the most significant risks as the crypto goal is to become more decentralized. This is a thought to approach in a different article. It would be fallible to say that Binance couldn't collapse as FTX did. But, Binance has better leadership, a stronger balance sheet (and war chest), and less counterparty risk than FTX.

For now, this is likely a coordinated FUD attack to shake the crypto market's confidence further. We can see other articles trying to attack Binance today as well:

US Senator Claims Binance Has Ties to Chinese Government

-u.today

FTX Hearing: Kevin O'Leary Attacks Binance, Calling It An "Unregulated Monopoly"

-Coindesk

I'm not saying I'm a fan of Binance. Centralized exchanges are a current necessary evil. But hopefully, via regulation, investors can directly access crypto assets via DeFi. Until then, we will have to deal with shady corporations.

What do you think? Am I downplaying the Binance risk? Is this coordinated FUD or a canary in the coal mine? Share your thoughts and opinions in the response section.

This article isn't financial advice, and I am not a financial advisor. It is strictly my opinion. Crypto assets involve tremendous risks. I am someone who wants to maintain and grow my wealth so that I can provide a good livelihood for my family and myself. So do your research before making any investments.