Binance calls circulating insolvency letter fake

Binance has said that a cease-and-desist letter circulating online, which claims the exchange is insolvent, is fake.

On February 4, a social media user claimed Binance was insolvent and shared an image of a purported legal notice demanding the user delete a post by a certain deadline.

Binance’s official customer support account responded, calling the document a forgery and warning users to be cautious of fake messages.

The user who posted the alleged notice said he would host a livestream to present evidence supporting his claims, while also promoting an online casino.

Rumors of Binance’s insolvency have circulated recently, linked to claims about its role in the October 2025 market crash, which was marked by platform issues and extreme volatility.

Binance has denied involvement in the crash, with former CEO Changpeng Zhao dismissing such claims as “far-fetched.”

Some community members have initiated withdrawal campaigns, but Binance has maintained that assets on its platform have increased despite these efforts.

The company has not provided further comment on the circulating claims or the fake legal notice.

🔗 Source: The Block

🧠 Food for thought

Implications, context, and why it matters.

Insolvency rumors followed specific platform incidents and a large user support program

A fake legal notice spread online, while insolvency talk also grew after Binance-owned incidents during the October 2025 market crash with outages and sharp volatility. In a separate October 10 flash crash, Binance said macro risks drove the disruptions rather than an exchange failure 1.
Binance said a slowdown in an internal asset-transfer system led some accounts to briefly display zero balances. It also reported short-lived price index deviations for assets including USDe and WBETH 1.
Afterward, Binance said it would set aside $400 million for a user recovery and support program, which added fuel to community speculation during tighter scrutiny 2.
Binance said the payments are meant to support users and do not amount to an admission of liability for user losses 2.

The incident reflects a trust gap tied to exchange opacity and alleged listing dynamics

The fast spread of a fake cease-and-desist letter points to a strained relationship between centralized crypto exchanges such as Binance and their users.
Some traders view Binance as a “kingmaker” because a listing can make or break a crypto project. Binance denied profiting from listings and called some allegations about listing-related demands “false and defamatory” 2.
Separately, some crypto projects face investigations for allegedly promising an imminent Binance listing to attract investors, even though no listing happened 3.
Limited visibility into listings and internal processes leaves gaps in knowledge, which can let rumors and misinformation spread.