Binance’s Proof Of Reserves Is Useless – Kraken’s CEO
Yesterday, November 25th, the famous crypto exchange Kraken’s chief executive officer, Jesse Powell, took to his Twitter page to criticise Binance’s Proof-of-Reserves. Jesse Powell stated that the Proof-of-Reserves is clearly not serving the purpose that it ought to, and he has no idea whether it is because of oversight or false representation.
Binance’s Proof-of-Reserves Not The Best Out There
Following the fall of the famous crypto exchange, FTX investors began to get overly cautious. In a bid to reassure investors and re-emphasise security, a quite large number of crypto exchanges came out to publicise their Proof-of-Reserves.
Ordinarily, the famous crypto exchange Binance spearheaded the effort and published its Proof-of-Reserves. However, asides from the initial criticism the whole exercise had attracted, a new one came in yesterday.
In reply to a tweet that was announcing Binance’s Proof-of-Reserves, Jesse Powell, the chief executive officer of Kraken, could not hide his displeasure.
According to him, the exact point of publishing the Proof-of-Reserves, which is the public knowing whether a crypto exchange had enough assets in its reserve to cover its debt, has been successfully set aside if the help of an auditor was not employed.
Jesse Powell, who could not hide his displeasure and wondered whether it was truly an oversight or a clear case of false representation on the part of Binance, stated that without an auditor to carefully examine that the crypto exchange had not added accounts with zero balances, the whole exercise is nothing but a child’s play.
He also went further to state that including assets without corresponding liabilities is misleading and implied that Binance ought to do better.
Binance’s CEO Replies
Binance’s chief executive officer had given some sort of reply to Jesse Powell’s remarks. According to him, the crypto industry is so transparent that crypto exchange owners could come out in public and criticise one another.
According to him, the occurrence is really normal and essential for the crypto industry to thrive. He also said that the exchange would provide a reply to Jesse Powell’s questions very soon.
Proof-of-Reserves Ought To Be Re-examined
With the recent development as regards Proof-of-Reserves, it brings us back to the Bank of America’s remarks earlier this month, which criticised the concept of Proof-of-Reserves as it is and stated that it alone does not certify security.
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