December 16, 2022

🥛Is Binance the next domino?

GM. This is the Milk Road, the daily newsletter that opens up the can of crypto for you.

This is the sound of our email hitting your inbox each morning. **Pssssssssssccchhk**

Here's what we got for ya today:

  • Is Binance the next domino?

  • Funding Friday

  • Quick Bites

  • Milky Memes


It was a week to celebrate.

SBF finally got arrested. A good CPI report. We announced the Milk Road acquisition. Life's good.

I was 4 rows of Oreos and 3 cups of milk deep when the Milk Man texted me about the latest crypto drama…Binance.

Milk Man: “Yooo, netflow of $3b+ in withdrawals from Binance this week”

Me: “Wtf why?”

Milk Man: “Twitter rumors. People are scared it could be the next domino to fall. Might just be FUD“

Here are some of the rumors flying around the Twittersphere:


Users have withdrawn $8.8b and deposited $5.1b within the past week.

That's relatively small compared to the ~$58b Binance still has in reserves, but there are whispers that the exchange could be in trouble.

Why? Binance’s reserves have been in the hot seat recently.

After the FTX collapse, everyone wanted to see other exchanges' proof of reserves. We were all screaming for proof of reserves like Jerry Maguire.

So Binance released an audit report in November to try to calm some nerves. Some people weren’t convinced though. Here's why…

Binance didn’t hire one of the 4 major audit firms. Instead, it chose… *checks notes*… Mazars (who?)

CZ told CNBC that it’s because the big boys don’t know how to audit crypto exchanges.

And the firm worked with Binance on an agreed-upon procedure, or AUP, which…is not a full audit or a stamp of approval that everything is accounted for. 👀

A former SEC regulator of 18 years called the whole thing a “red flag.”

Ex-Kraken CEO Jesse Powell called bullsh*t, too.

Oh and that French auditor, Mazars? Today it said that it's pausing all crypto services. The link to its assessment of Binance's reserves is completely offline now too.

Uh-oh spaghetti-o…


This CZ interview has been making the rounds.

It has to do with something called a clawback. When firms go bankrupt, sometimes the court can claw back funds the bankrupt company sent out in the period leading up to the bankruptcy.

FTX sent Binance $2.1b when they cashed out their seed investment.

So the CNBC reporter asked CZ. "Would you be able to handle it if someone asked for $2.1b back?"

He simply responded: “We’re financially strong."

To add fuel to the fire, there are also rumors that:

  • The DOJ could charge Binance for anti-money laundering crimes, but it's reported the DOJ can't agree on if they have enough evidence to prosecute

  • Binance execs are reportedly jumping ship

It’s not FTXesque Defcon 1, but it’s worth keeping an eye on.

If the DOJ did prosecute or Binance collapsed, that’d be the big kahuna of crypto downfalls.


Most people buy crypto to invest. They want to see their money go from $1,000 to $5,000.

They want to go from crashing at their parent’s place to buying the house at the end of the cul-de-sac.

The truth is crypto wasn’t made to get people rich. Crypto was made as an alternative to our current financial system. However, it still hasn’t touched one of the largest parts of the financial system… real estate.

Right now buying a home has more hoops to jump through than the Westminster Dog Show.

But a company that has done $5b in transactions since 2015 is changing how we buy homes.

The company is called Roofstock On-Chain and they are making it easy to buy Real Estate on the blockchain.

Roofstock says on-chain real estate makes sense if you:

  • Have money in crypto and are looking for a safe place to invest it

  • Want to get an on-chain mortgage using your tokenized home as collateral

  • Want everything in one central place without 100 message-long email chains of documents

Learn how you can buy or sell your next home on the blockchain with Roofstock.


Each Friday we give you a rundown of Web3 companies that got funded during the week.

This week, we saw ~$220m get invested into crypto companies & funds. Here’s who got the money:

Aztec got $100M to build a privacy-first zk-roll up on Ethereum. It’s the programmable privacy layer for web3

Liquid Access got $3M to turn your memberships & subscriptions into NFTs.

Outdefine got $2.5M to create a decentralized talent community to hire others or find work.

Nametag got $2M to be your web2 + web3 ID. Connect your socials (Twitter, Discord, etc) and showcase your NFTs

If you wanna check out the complete database of companies that raised money in 2022, we got 'em for you right here.


MetaMask and PayPal team up to let users easily buy crypto using a PayPal account.

9 creditors have been named to form the committee in charge of the FTX bankruptcy. Wintermute, GGC International, Octopus, and Wincent Investment Fund were a few chosen.

Coinbase drops a new tool that lets users recover ERC-20 tokens. ~4000 unsupported tokens have been sent to Coinbase by accident. It was all “lost money”, until now.

Trump released a new NFT collection called Trump Cards. They go for $99 a pop, and the marketing looks like it came from the 1990's.

Dreambound Orbital sends the first NFTs to the International Space Station. They took "wen moon?" quite literally…


SBF found out real quick…

That's a wrap for today. Stay thirsty & see ya tomorrow! If you want more, be sure to follow our Twitter (@MilkRoadDaily)


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DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.