Exchanges must show their credentials – The case FTX Will it mark the beginning of a new era in the cryptocurrency ? At the level of others platforms in any case, the reactions multiply in an attempt to to reassure users on the reliability or solidity of the companies in question. And the future solution could be called Proof of Reserve, a concept revived by the CEO of Binance in a recent statement. Reassure users and investors at all costs with maximum transparency is the new buzzword for centralized crypto players. We explain to you.
Avoid at all costs a general crisis of confidence in the ecosystem
The misleading statements of Sam Bankman-Fried will not only have harmed the unfortunate users of its crypto platform, they will also have started the trust general public. The main players in the sector are therefore seeking to limit damage and as soon as possible.
Changpeng Zhao (CZ), the CEO of Binance, has already taken the lead in proposing that exchanges be able to prove that they have in Reserve the equivalent of funds deposited by users. This concept, called Reserve Evidence Where proof of funds, could be a solution. Immediately, several platforms like OKX Where Kucoin have also announced that they want to use this tool.
This is howOKX posted the following message:
“For OKX, transparency, risk management and consumer protection come first. We are recruiting Armanino for an audit and will post a Merkle tree as auditable proof of funds as soon as possible. Here are already 23 BTC addresses (…) and 13 Ethereum addresses (…) as part of our reserves to be checked by all users. »
>> Your first bitcoins in a few minutes? Sign up on Binance (commercial link) <<
Reserve proof as a guarantee for users?
And in the continuation of the thread of the message, OKX actually joins the addresses of some wallets held by the platform. This level of transparency is unheard of for a broker and it lives up to the fears of users. As a reminder, Merkle tree is a term used in the industry to refer to a data structure – accessible to everyone – bringing together a large amount of anonymized information which makes it possible to compare customer balances with the overall balance of the exchange.
The CEO of Kucoin, Johnny Lyualso made a similar statement, speaking of a reserve proof to be provided within a month. He also mentioned a company ofaudit recognized in the financial community to carry out the audits. Then, he wanted to publish a message of encouragement for the community:
“I would like to express my sympathy to everyone who has been affected by the current situation at FTX. Hopefully everything can be resolved quickly and the industry can get back on track. »
The eagerness of the major players in the ecosystem to communicate on these various tools allowing prove their solvency shows to what extent the crisis of trust is real. The road will be long to rebuild a healthy relationship with customers and that is why OKX, Kucoin and even kraken have already adopted these new tools. It would still be necessary for the bad news to stop coming out one behind the other to see a clearing.
If CZ inspires the CEOs of other exchanges, you can trust him! Register quickly on the Binance platformTHE absolute benchmark in the sector (commercial link).