What did BB Trade Estonia's accounts show about client assets?

analysisIn 2021 BB Trade Estonia OÜ's sales revenue was EUR 23,819,262, against EUR 9,117,007 in 2020 as corrected in that report (the first annual report had shown EUR 8,837,007). Poland supplied EUR 17,937,221 of it (2020: EUR 4,451,443), and in 2020 a further EUR 2,824,086 was attributed to Malta. Fees paid to payment intermediaries rose to EUR 1,444,421 (2020: EUR 611,358) and the cost of licence fees and platform use to EUR 2,189,404 (2020: EUR 1,300,000). ¹

analysisThe consolidated balance sheet at 31 December 2022 showed total assets of EUR 196,559,328, made up mainly of EUR 155,252,930 of crypto-asset inventories and EUR 9,959,948 of cash, against payables and prepayments received of EUR 166,762,446, a EUR 5,000,000 loan and equity of EUR 24,796,882. The group's profit for 2022 was EUR 1,142,183; the company's own profit, shown in an annex, was EUR 1,735,279, the difference being the scope of the two statements. At 31 December 2023 consolidated total assets were EUR 375,965,919, including EUR 309,948,409 of crypto-asset inventories and EUR 4,924,500 invested in subsidiaries and associates, with a EUR 10,000,000 loan, equity of EUR 26,223,954 and a 2023 profit of EUR 1,040,294; during 2023 the group paid EUR 4,132,500 for associates and granted EUR 7,572,711 of loans. ^{2 3}

analysisIn 2024 the company issued its own utility token, ZND. At the token generation event on 18 October 2024 a total of 700,000,000 ZND were created, of which up to 183,400,000 had been offered in sale rounds between June and October; 5,600,000 tokens from a launchpad round that could not be completed were burnt, the presale raised EUR 11,706,800 and trading on the zondacrypto exchange began on 24 October 2024. ⁴

analysisThe 2024 consolidated accounts show sales revenue of EUR 6,076,753 and other operating income of EUR 20,552,305, of which EUR 19,545,016 related to the ZND token: a EUR 4,018,309 gain on the change in the token's value, EUR 13,696,115 booked as a ZND token receivable for tokens that moved under smart contracts into company-controlled wallets from October 2024, and EUR 522,386 and EUR 1,308,206 from token sales before the token generation event. The group's 2024 profit was EUR 8,443,567 and the company's own profit EUR 10,601,975. Total assets reached EUR 768,208,697, including EUR 594,127,140 of crypto-asset inventories and EUR 121,226,865 of receivables and prepayments, against liabilities of EUR 733,210,694, of which EUR 9,861,091 related to the ZND token, and equity of EUR 34,998,003; there was no loan liability. The report does not compare the result with and without the token items; a law firm acting for claimants in the bankruptcy says that without them the 2024 result would have been a loss. ⁴

analysisThe company's first annual report, covering 30 September 2019 to 31 December 2020, said it held crypto-assets on behalf of clients, with no responsibility for holding them and no economic benefit from them, and reported EUR 192,688,141 of obligations relating to clients' crypto-assets off the balance sheet at 31 December 2020. From the 2021 report onward clients' crypto-assets were recognised on the balance sheet as client assets within inventories, with matching liabilities to clients: at 31 December 2021 clients owned virtual currencies worth EUR 482,676,641 and the company EUR 132,683, mostly bitcoin (36%) and ether (31.5%). The 2021 report restated the end-2020 holdings at EUR 191,758,642, all belonging to clients, and the two reports do not reconcile that figure with the EUR 192,688,141 given a year earlier. ^{1 2}

analysisClient money stood at EUR 31,750,893 at the end of 2021 (EUR 48,390,205 a year earlier). The 2021 report says it was kept separate from the company's working capital and partly held by payment service providers, and that under the client agreement the company had the right to use funds in client accounts and had done so in 2020, recording EUR 906,184 as a debt to clients at 31 December 2020. Of all cash at the end of 2021, EUR 5,648,135 was in bank accounts and EUR 27,586,730 with payment service providers; the company's own cash was EUR 1,483,972, after none a year earlier. ²

analysisAt 31 December 2022 clients owned virtual currencies worth EUR 154,384,891 and the company EUR 868,039. Liabilities to clients totalled EUR 164,207,285: a client cash balance of EUR 34,206,833, made up of deposits awaiting confirmation or rejection and funds awaiting withdrawal, and EUR 130,000,453 owed to clients in crypto-assets. The company's own cash was nil. The 2022 report says the company holds part of clients' funds in crypto-assets and that it used its contractual right to use client funds in 2022, recording the amount used, EUR 26,220,117, as a debt to clients; the note dates that figure "as at 31.12.2023". ^{3 4}

analysisIn the 2023 consolidated report client money was EUR 30,851,817 at the end of the year. The company again used client funds under the client agreement, recording EUR 18,939,269 as a debt to clients, and held its fiat obligations to clients in crypto-assets. Of the EUR 308,223,793 it owed clients in crypto-assets, EUR 289,189,285 was the liability for virtual currencies and EUR 19,034,508 the liability arising from the use of client funds. ⁴

analysisAt 31 December 2024 clients owned virtual currencies worth EUR 565,415,120 and the company EUR 28,712,020, of which EUR 7,886,423 was its own ZND token; bitcoin made up 71% of the holdings, ZND 5% and ether 4%. The client assets and liabilities line stood at EUR 722,356,044 (2023: EUR 338,875,597), including a client cash balance of EUR 74,195,735. Of EUR 648,160,309 owed to clients in crypto-assets, EUR 565,415,120 was the liability for clients' crypto-assets and EUR 82,745,189 the liability from the use of client funds, in fiat and crypto. The report states that the company holds part of client funds in crypto rather than money, may use funds in client accounts under the client agreement and has reinvested client funds both short- and long-term. ⁵

analysisThe reports do not give one consistent figure for 2022. The 2022 report records EUR 26,220,117 of client money used and owed to clients, while the 2023 report shows EUR 1,835,679 as the 2022 comparative for liabilities arising from the use of client funds. A law firm acting for claimants cites the balance sheets as showing customer-fund use of EUR 26.2 million in 2022, EUR 19 million in 2023 and EUR 82.7 million in 2024. The two notes may measure different items, fiat client money used against a crypto-denominated liability, but the reports do not reconcile them. ^{1 2 3}

analysisAccording to the same law firm, which read successive versions of the exchange's terms of service that are not in the retained record, the terms of the Zonda period (2021–2024) let the exchange hold clients' fiat and crypto funds with external operators in its own name but on the client's behalf, and the version of 30 December 2024 was the first to contain the client's consent to zondacrypto using funds and crypto-assets in client accounts in its own name without paying interest. The company's own annual reports from 2021 onward state that the client agreement in force gave it the right to use funds held in client accounts, and report the amounts used. The firm says the version of 19 July 2025 dropped the clause on using client funds on the exchange's own account and added that the exchange does not speculate on prices and is not a market maker, while separate ZND Earn and ZND Farming terms that took effect at the same time allow Earn customers' funds to be used for operations of zondacrypto or related entities, including secured loans; the July 2025 exchange terms were not retained, but the retained version of 3 October 2025 contains the market-maker statement. ^{1 4 5}

analysisThe terms valid from 3 October 2025 say that zondacrypto itself does not provide payment services: licensed payment operators handle deposits and withdrawals and safekeep clients' fiat on dedicated accounts, where it remains at the clients' disposal. By accepting them the client agrees that zondacrypto may hold the client's fiat and crypto-assets with various external operators in its own name but for the client, without paying interest; the same terms state that zondacrypto does not speculate on prices and is not a market maker. ⁵

analysisThe exchange's marketing said more. Its "safety of funds" page, archived in January 2026, told clients that all crypto-assets were kept in cold wallets not directly connected to the exchange's servers and that "a bank" guaranteed clients' fiat funds. That is the operator's own statement: the October 2025 terms say fiat is safekept by payment operators, and the auditors of the 2021–2023 statements could not verify control of large crypto balances. The ZND platform's website, archived the same month, advertised digital assets "securely stored offline" and an Earn service paying weekly rewards on 34 crypto-assets, tokens and stablecoins at up to 23% a year, while according to the claimants' law firm the ZND Earn terms allowed Earn customers' funds to be used for operations of zondacrypto or related entities. The 2022 annual report also lists a migration to BitGo V2, a custody platform, among the IT department's plans for 2024. ^{6 7 2}

analysisAudit Advisory OÜ, through sworn auditor Liina Tamm, qualified its opinion of 24 September 2021 on the 2020 statements: it found revenue understated by about EUR 280,000 and expenses by about EUR 146,000 because of the accounting system used, and could not assess whether about EUR 1,302,000 of loan and interest receivables needed impairment. In its 2021 annual report the company stated that it had corrected its 2020 revenue and expenses: 2020 revenue rose by EUR 280,000 to EUR 9,117,007, costs of goods, materials and services by EUR 144,845, and the 2020 profit from EUR 6,491,835 to EUR 6,626,090. Tamm has been the firm's sole management board member since 1 December 2008 and holds all of its share capital. ^{1 2 3}

analysisFor 2021 Crowe DNW OÜ (formerly DNW Audit OÜ, registry code 14299250), through sworn auditor Anton Mullo, a procurator of the firm since 8 October 2021, disclaimed an opinion in a report of 30 November 2022. Its main ground was the EUR 482.8 million of virtual currencies in inventories: bitcoin worth about EUR 145.7 million was, according to the company, held in a wallet to which management had restricted access citing security measures, so the auditor could not verify its existence or ownership. It also cited about EUR 9.5 million of other virtual currencies without wallet statements or addresses, unverifiable LUNA (about EUR 13.1 million) and litecoin (about EUR 2.4 million) balances, about EUR 1.9 million of tokens valued at prices from the company's own platform, about EUR 34.2 million of client liabilities that the accounting system could not attribute to individual clients, and about EUR 2.4 million of investments not tested for impairment. It further cited about EUR 3.9 million of loans not repaid by the time of the report, whose borrowers' intention and ability to repay it could not assess, as the previous auditor had noted for 2020; about EUR 0.9 million of revenue without detailed transaction statements; a gain of about EUR 0.6 million on crypto-currency values without underlying data; and an opening balance of about EUR 182.4 million of virtual currencies and EUR 241.4 million of client liabilities that had never been audited. ^{2 4 5}

analysisAssertum Audit OÜ (registry code 10990446), registered as the company's auditor from 20 June 2023, audited the 2022 to 2024 consolidated statements through sworn auditor Sergei Tšistjakov, a management board member of the firm since 6 May 2015. Its opinion of 12 January 2024 on 2022 was qualified: because the previous auditor had disclaimed an opinion on 2021 it gave no assurance on opening balances and comparatives, and crypto-assets of EUR 155,252,930 were partly held by third-party service providers that do not confirm the assets they hold. The opinion of 30 June 2024 on 2023 was qualified too: crypto-assets of EUR 172 million (2022: EUR 155 million) sat in the "wallet" of the group's own platform and the auditor could not test that the group had substantive control over them; instead of testing, management proposed a notarial confirmation of control. The auditor also gave no opinion on EUR 1.8 million of fee revenue it could not test. ^{6 7 5 8 4}

analysisOn 29 July 2025 the same auditor issued an unqualified opinion on the 2024 consolidated statements, stating that they present fairly in all material respects the group's position at 31 December 2024. ⁹