Binance, the world’s largest and most popular digital currency exchange, has announced a new program that will give all current and future crypto investors proof of its present bitcoin and Ethereum reserves.
Binance Tries to Show It’s Not Like FTX
The goal is to shed light on the issue of transparency and show the company is nothing like FTX, the now failed digital currency exchange that came to fruition only three years ago in 2019. Binance was initially in line to purchase the digital currency exchange when it began experiencing financial problems, though the company later decided that the issues FTX was facing were too big for it to handle, and it wound up backing out of the deal.
In any case, it looks like Binance is taking a lesson from the fiasco that is FTX and trying to not only separate itself from the now deceased company, but also show people why it and the crypto arena in general can still be trusted.
Right now, the company has made clear how much BTC and ETH it has in its reserves tank, though it’s not stopping here. The company has issued a statement suggesting it has more crypto units to its name, and information about those reserves will be made available in the coming weeks.
The statement says:
When we say proof of reserves, we are specifically referring to those assets that we hold in custody for users. This means that we are showing evidence and proof that Binance has funds that cover all our users’ assets 1:1, as well as some reserves.
At the time of this article’s writing, Binance has released a screenshot showing that it has more than 582,000 bitcoin units stashed away. Right now, there are just over 572,000 units of bitcoin stored on the exchange that are owned by individual traders. From this information alone, we can assume that Binance has enough money to cover everybody’s stashes and potential losses (should they occur) while still having a little left over.
This may appear positive at first glance, but there are several traders out there who feel this isn’t enough. Binance anticipated this attitude and provided steps in a recent press release discussing how traders can verify this data for themselves and ensure their units are privately accounted for.
See for Yourself!
The release said:
For those who want to go a step further and independently verify their funds, they can copy the source code into a python application and cross reference it themselves.
FTX was long considered the golden child of the digital currency world, and its founder and chief executive, Sam Bankman-Fried, was lauded as a genius by many for his ability to potentially take a major company as far as he reportedly did in just three years.