Binance founder Changpeng Zhao (CZ) has called for stricter safeguards in the Digital Asset Treasury (DAT) sector following the sudden collapse of QMMM Holdings, a U.S.-listed firm accused of market manipulation.
The company’s stock surged 960% after announcing plans in September 2025 to invest $100 million in Bitcoin, Ethereum, and Solana, before coming under SEC scrutiny for alleged stock manipulation.
In a post on X, CZ emphasized that all DAT companies must employ third-party crypto custodians and have account setups audited by investors. He noted that these measures would now be mandatory for any YZi Labs investment in BNB-affiliated DAT projects.Â
“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,” CZ wrote.
The QMMM controversy began when the company announced its $100 million crypto reserve plan, causing its share price to spike dramatically. Shortly after, the U.S. The Securities and Exchange Commission (SEC) accused the company of manipulating its stock price, leading to a temporary Nasdaq trading halt from September 29 to October 10, 2025.
Reports revealed that QMMM’s Hong Kong office in the Seaview Building had been vacated, raising fears that executives had fled, leaving investors in uncertainty.
QMMM, registered in the Cayman Islands, operates subsidiaries in Hong Kong focused on media and animation, a structure that raised questions about its ability to manage a large cryptocurrency treasury.
The incident has reignited debate in the crypto sector over transparency, accountability, and investor protection in companies holding significant digital asset reserves.
CZ’s call for third-party custodianship and independent audits highlights the growing need for governance in the DAT space.
Analysts say these measures could help rebuild investor confidence and prevent fraudulent activities, while signaling a broader industry shift toward greater oversight and operational transparency.
As incidents like QMMM’s collapse demonstrate, robust safeguards are crucial for maintaining credibility in the rapidly evolving cryptocurrency ecosystem.