Dimplx noted that the amended financial statements by Binance Digital “remain unreliable for the purposes of determining the present fair value of Dimplx Limited’s shareholding in Binance Digital”.
UK subsidiary shareholder of Binance called Dimplx has accused the crypto exchange of misrepresenting the shareholder’s ownership in the official company’s filings. Dimplx noted that Binance’s UK subsidiary – Binance Digital Limited – has filed “grossly inaccurate” financial statements on an annual report filed last month with the UK companies registrar.
Dimplx added that the financial reports do not accurately report the nature of its business. Furthermore, nor does the report, reflect the company’s turnover, assets, and liabilities, etc.
In its filing this month, Dimplx noted that the amended financial statements “remain unreliable for the purposes of determining the present fair value of Dimplx Limited’s shareholding in Binance Digital”. To get a fair determination of Dimplx’ ownership stake in Binance Digital, they will need to conduct an accurate assessment of all transactions, liabilities, income, and associated taxes. Dimplx stated that they will be engaging in legal correspondence with Binance Digital. The report from Dimplx notes:
“Dimplx Limited has reserved its right to obtain a court ordered valuation of its shareholding as well as its right to seek both ordinary and exemplary damages/ or an order directing an exchange of its shares at a value to be determined by order of court”.
Partnership with Binance UK Entity
Dimplx entered into a joint partnership with Binance’s UK entity, Binance Digital back in 2019. Back then, Binance started its UK operations as a payments processing facilitator
However, Dimplx added that there were several inaccuracies in Binance Digital’s accounts for 2020. As per Binance filings, Binance Digital roughly had £100 million ($100 million) in “cash and/or bank balances” by the end of 2020. Binance also stated that the same sum was owed to “creditors”.
But Dimplx directors believe that the £100 million represented balances held “on behalf of Binance Digital customers who had visited binance.com,” who would be “liable to pay transaction fees”.
The financial statement provided by Binance recorded “zero turnover or fees,” on transactions done by the customers in that financial year. As per Binance Digital’s 2020 accounts, there was no turnover or revenue in that financial year.
Amid these disputes arising in this business partnership, Dimplx seeks to pursue litigation against Binance. A Binance spokesperson said:
“In light of threats of litigation from the minority shareholders, Binance is not able to respond fully to the allegations. However, we understand that the minority shareholders are disappointed that the joint venture did not bear fruit.”
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Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.
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