According to a Bloomberg report, Binance is transitioning towards a “semi-automated” system for overseeing the reserves of its issued tokens. This comes after a prolonged period during which customer funds were intermingled with reserves, and at least one stablecoin – the Binance-peg BUSD – was occasionally undercollateralized.
Last month, the crypto exchange recognized the issues with B-tokens and stated that they had been resolved.
As per a spokesperson cited by Bloomberg, Binance has introduced a partially automated process to guarantee that B-tokens are constantly backed in a transparent manner. The process only permits the creation of new coins after the corresponding wallet has been funded with collateral.
Binance has been moving collateralized assets to separate wallets for each network over the last few weeks to ensure transparent visibility of the 1:1 backing, according to a spokesperson. The collateral has always supported Binance’s users’ B-token assets and has been accessible for withdrawal at any time. Binance is now displaying the collateral on-chain in dedicated wallets where it will remain until necessary.
According to the spokesperson, Binance opted for a partially automated process for its new system to mitigate potential security risks.
