Hi HODLers,
Well, these past few weeks have been full of drama which seems to never stop!
The latest one?
Binance published its Proof of Reserve to reassure but...
It got called out by Kraken CEO as they did not disclose any liabilities. And as Jesse rightly pointed out, you can have a strong balance sheed a.k.a reserves but if you have borrowed more than this on other exchanges, well... You are actually under water.
“The whole point of this is to understand whether an exchange has more crypto in its custody than it owes to clients. Putting a hash on a row ID is worthless without everything else.”
I am not saying that Binance did this but it is a valid question. To answer this, we will need to wait for Binance's Audit!
CZ does agree in some way as he is planning to have a 3rd party auditor review Binance's liabilities:
Twitter users have pointed out that CZ disabled public comments under the post where he is welcoming questions.
In any case, I truly hope there is not another FTX scandal as the Crypto ecosystem can't handle more drama.
Stay safe,