Binance founder Changpeng Zhao (CZ) has called for stricter regulations on Digital Asset Treasury (DAT) companies, urging mandatory third-party crypto custodians and investor-audited account setups in response to the collapse of QMMM, a US-listed firm accused of market manipulation. This move follows QMMM's stock surging 960% after announcing a $100 million plan to build reserves in Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) in September 2025, before the SEC accused it of stock manipulation via social media hype.
In a post on X (formerly Twitter), CZ stated, "All DAT companies should use 3rd party crypto custodians with account setup audited by investors. This is a prerequisite for YZi Labs investments in BNB DATs." He emphasized that without these safeguards, institutional trust in crypto projects remains at risk. The QMMM scandal escalated when reports revealed the company had vacated its Hong Kong office, fueling fears that executives had fled amid the investigation.
QMMM, which went public in 2024 at $4 per share and saw its price spike to $303 intraday (a 560-fold increase) before crashing to $0.54, has been labeled a "runaway MicroStrategy" by industry observers. The SEC halted trading due to artificially inflated volumes and potential Reddit-driven manipulation, highlighting vulnerabilities in companies holding large crypto reserves. CZ's stance aims to enforce greater transparency and deter fraud, with analysts viewing it as a necessary step to rebuild investor confidence in the crypto industry.
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