Michael Burry says crypto audits are 'essentially meaningless'

Crypto audits 'essentially meaningless,' top investor says

By Claire Ballentine December 19, 2022, 10:48 a.m. EST 1 Min Read

The investor who foresaw the housing market crash in 2008 is skeptical about today's crypto audits.

Michael Burry — played by Christian Bale in "The Big Short" movie — said in a tweet on Friday that examinations of digital asset holdings in firms like Binance Holdings Ltd. and FTX are "essentially meaningless," because auditors are learning on the job, much like they were in 2005 with credit-default swaps.

This is the problem. In 2005 when I started using a new kind of credit default swap, our auditors were learning on the job. That's not a good thing. Same goes for FTX, Binance, etc. The audit is essentially meaningless. pic.twitter.com/mA3MMvaUTu
— Cassandra B.C. (@michaeljburry) December 16, 2022

The founder of Scion Asset Management referenced a Bloomberg article stating that the accounting firm used by Binance is halting all work for crypto clients, a blow to the credibility of an industry already reeling from FTX's collapse last month. He did not immediately respond to a request for comment.

With a cult following on Twitter, Burry is known for making cryptic predictions to his followers, especially about the stock market. His latest tweet references the complex instruments that helped bring about the financial crisis in 2008, as officials and the financial realm at large didn't fully understand the risks.

Claire Ballentine

Bloomberg News