Binance CEO urges crypto exchanges to provide proof of customer deposit

Binance CEO Changpeng Zhao (CZ) has just called on popular crypto exchanges to provide proof of customer deposits.

The solution proposed by the CEO of Binance is said to be to avoid a similar case with FTX – a famous cryptocurrency exchange run by Sam Bankman-Fried suddenly stopped processing withdrawals for a few days. this.

As VietTimes mentioned, the incident at FTX has brought fear of a liquidity crisis in the crypto community and the consequences could be many times more severe than the collapse of LUNA coin.

CZ said that Binance will soon make all data on the exchange’s reserves open and transparent.

“Clearly cryptographically proving the solvency of exchanges and financial institutions is becoming the new industry standard. Proof-of-Reserves is a great example of a world of finance. Mainstream is cryptographically secured, starting with cryptocurrencies, followed by traditional finance,” Sergey Nazarov – CEO of Chainlink – expressed his opinion on the mechanism proposed by CZ.

Meanwhile, crypto exchange Kraken has implemented an enhanced cryptographic accounting process to allow users to verify token balances in wallets since February 2022.

The OKX exchange also announced plans to implement “Proof-of-Reserves” based on the Merkle Tree data structure – which OKX sees as an important step forward in establishing investor confidence in the industry. this emerging industry.

Besides announcing the agreement to buy back FTX exchange, CZ also announced that it will deposit 700 million USD of BNB and BUSD along with 300 million USD of BTC into SAFU fund to increase the value of this fund once again to USD 1 billion.

Secure Asset Fund for Users (SAFU) is an emergency insurance fund established by Binance in July 2018 to protect user assets. When the fund was created, the exchange committed to deduct 10% of the revenue from transaction fees on the exchange to increase the money fund for SAFU in the form of BTC, BNB, BUSD.

Therefore, the value of the fund will depend on the volatility of the market and these currencies.

According to Coin68, Cointelegraph