When discussing cryptocurrency exchanges, Binance is almost always one of the first names that comes to mind. As one of the most prominent platforms in the digital asset space, it has attracted millions of users worldwide with its wide range of services, high liquidity, and global presence.
But a common question among newcomers — and even experienced investors — remains: Is Binance safe? Is it a scam?
In this comprehensive review, we’ll examine Binance’s security infrastructure, regulatory status, founder background, asset transparency measures, and real user sentiment from communities like PTT. We’ll also explore its achievements, past incidents, and how it compares to other major exchanges — all to help you make an informed decision.
What Is Binance’s Background?
Founded in 2017 by Changpeng Zhao (CZ), Binance quickly rose to prominence in the crypto world. The exchange completed its initial coin offering (ICO) within just two weeks, raising $15 million. Within six months, it had amassed 6 million users, rapidly becoming a leading player in the global cryptocurrency market.
Today, Binance serves over 120 million registered users across 200+ countries and regions, with a daily trading volume exceeding $38 billion. It supports more than 350 cryptocurrencies, making it one of the most diverse and liquid trading platforms available.
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Unlike decentralized exchanges (DEXs), Binance operates as a centralized exchange (CEX), meaning users trade through a centralized platform that manages custody of assets. This model requires identity verification (KYC) and offers a more familiar experience for those used to traditional financial systems — similar to opening a brokerage account for stock trading.
To enhance security, Binance stores the vast majority of user funds in cold wallets — offline storage systems immune to online hacking attempts. In cases of suspicious account activity, withdrawal limits are automatically triggered, often requiring a 24–48 hour cooldown period before funds can be moved.
Who Is the Founder of Binance?
The driving force behind Binance is Changpeng Zhao (CZ), a former software developer with deep experience in finance and technology. Before entering the crypto space in 2013, CZ worked at major financial institutions, including the Tokyo Stock Exchange and Bloomberg Tradebook.
In 2014, he made a bold move: selling his home in Shanghai and investing nearly $1 million into Bitcoin. He then joined OKCoin as CTO before leaving to launch Binance in July 2017.
One of Binance’s key innovations was the launch of its native utility token — BNB (Binance Coin) — with a fixed total supply of 200 million coins. Initially used to reduce trading fees on the platform, BNB has evolved into one of the largest cryptocurrencies by market cap.
Under CZ’s leadership, Binance grew at an unprecedented pace:
- 2018: Featured on Forbes’ cover as third-richest person in the crypto industry.
- 2021: Briefly became the “new Chinese billionaire king” based on net worth.
- 2022: Reached a personal valuation of $90 billion, placing him among the world’s top 10 wealthiest individuals.
However, in November 2023, CZ stepped down as CEO after pleading guilty to violating U.S. anti-money laundering laws. Binance agreed to pay $4.3 billion in fines**, and CZ personally paid **$175 million as part of a settlement allowing the company to continue operations.
Despite this legal challenge, the platform remained operational, demonstrating resilience and institutional maturity.
Is Binance Regulated?
Regulation is a critical factor when evaluating exchange safety. While some in the crypto community oppose regulation, Binance has taken proactive steps toward compliance:
- Acquired operating licenses in Dubai, Bahrain, France (AMF DASP registration), and the UAE.
- Appointed former regulators, including the ex-head of international relations at Dubai Financial Services Authority (DFSA), to strengthen regulatory engagement.
- Committed to reapplying for authorization in the UK and accepting oversight from Japan’s Financial Services Agency (JFSA) via its acquisition of Sakura Exchange Bitcoin (SEBC).
CZ has consistently emphasized that integration with traditional financial systems — including banks and payment processors — requires regulatory legitimacy.
“We’ve always believed in working closely with regulators and law enforcement agencies around the world,” said CZ.
These efforts position Binance ahead of many competitors in terms of global compliance strategy.
Does Binance Provide Proof of Reserves?
Following the collapse of FTX in 2022, investor confidence in exchange solvency plummeted. In response, Binance launched its Proof of Reserves (PoR) system to promote transparency.
This system uses Merkle trees — cryptographic structures that allow independent verification of data integrity — to prove that Binance holds sufficient reserves to cover all user assets on a 1:1 basis.
As of September 9, 2024:
- Total Bitcoin reserves: 647,106 BTC
- Coverage ratio: 106.84% of user liabilities
Assets currently covered include:
- BTC, ETH, BNB, USDT, USDC, BUSD, XRP, LTC, LINK
Users can verify their inclusion in the audit by visiting the Binance Proof of Reserves page, navigating to Wallet > Audit Reports, and checking Merkle root data and record IDs.
Additionally, Binance maintains the SAFU Fund (Secure Asset Fund for Users), established in 2018. A portion of every trading fee — originally 10% — is allocated to this emergency insurance pool designed to compensate users in case of security breaches.
Was Binance Ever Hacked?
Yes — in May 2019, hackers exploited vulnerabilities and withdrew 7,000 BTC (worth ~$40 million at the time). However, Binance responded swiftly:
- Publicly disclosed the breach within hours.
- Used the SAFU Fund to fully reimburse affected users.
- Upgraded security protocols and internal controls.
Notably, no user lost funds due to the attack. The loss was absorbed entirely by Binance itself.
This transparent response actually strengthened trust among users. The platform bounced back quickly, with BNB recovering its value within weeks.
Moreover, Binance has since assisted users who lost funds on decentralized platforms — such as DeFi scams — by using forensic tools to trace stolen assets. One notable case involved recovering nearly $30,000 for a user after a phishing attack.
Is Binance a Scam?
Absolutely not. Here’s why:
- It ranks #1 on CoinMarketCap and consistently appears in the top 10 on CoinGecko based on liquidity, traffic, and reported volume reliability.
- It powers over $38 billion in daily trades, far surpassing most competitors.
- It serves more than 120 million users globally, making it the only exchange to cross the 100-million-user threshold.
- It offers extensive educational resources via Binance Academy, helping users understand blockchain and trading fundamentals.
While no exchange is completely risk-free, Binance has demonstrated long-term stability, strong risk management practices, and a commitment to user protection.
What Do Users Say About Binance on PTT?
On Taiwan’s popular forum PTT, opinions about Binance are mixed but generally positive:
“How could Binance possibly go under? FTX didn’t even have one-tenth of its volume.”
“I trust them — they’ve proven they’ll cover losses if something goes wrong.”
Some express caution:
“Putting money in any offshore exchange means accepting some risk.”
“If you’re scared of collapse, just use cold wallets.”
Others adopt a pragmatic view:
“Everyone in crypto knows there’s always risk. If you can’t handle it, don’t play.”
“I’m more likely to lose my private key than see Binance fail.”
These sentiments reflect broader market understanding: while risks exist, Binance remains one of the most trusted names in crypto.
Should You Use Binance?
For most users seeking access to diverse cryptocurrencies, high liquidity, and advanced trading tools, Binance is a solid choice — especially given its robust security infrastructure and global compliance efforts.
However, best practices still apply:
- Diversify holdings across multiple platforms.
- Use two-factor authentication (2FA).
- Consider withdrawing large amounts to personal cold wallets.
- Stay informed about regulatory developments.
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Frequently Asked Questions (FAQ)
Q: Is my money safe on Binance?
A: Yes — Binance uses cold storage for most funds, offers Proof of Reserves verification, and maintains the SAFU insurance fund to protect users during extreme events.
Q: Has Binance ever lost user funds?
A: No. Despite a major hack in 2019, all users were fully reimbursed using the SAFU Fund. No customer lost money.
Q: Can I trust Binance after CZ’s legal issues?
A: Yes. While CZ stepped down following regulatory violations, Binance continues operations under new leadership with enhanced compliance measures.
Q: How does Proof of Reserves work?
A: It uses Merkle trees to cryptographically verify that Binance holds enough assets to cover all user balances — ensuring 1:1 reserve coverage.
Q: Should I keep crypto on Binance long-term?
A: For active traders, yes. For long-term holders, consider transferring large amounts to self-custody wallets for maximum control.
Q: Is Binance available in Taiwan?
A: Yes — many Taiwanese users access Binance via international versions of the platform. KYC verification is required for full functionality.
Final Thoughts
Binance is not a scam — it’s one of the most influential and resilient players in the cryptocurrency ecosystem. While past incidents highlight inherent risks in digital asset trading, Binance’s transparent responses and continuous improvements reinforce its position as a leader in security and innovation.
Whether you're a beginner or seasoned trader, understanding both the strengths and limitations of any exchange is crucial. With proper risk management and awareness, platforms like Binance can be powerful tools for participating in the future of finance.
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