Quote from: AlcoHoDL on November 27, 2022, 08:15:56 PM

Quote from: JayJuanGee on November 27, 2022, 06:53:41 PM

Quote from: Hueristic on November 27, 2022, 06:41:36 PM

https://twitter.com/jespow/status/1596227034190995457?cxt=HHwWgoCjnfmB-KYsAAAA

I am all fine with proclaiming that something is not enough... yet? Do we want to go from zero to perfect? And, what is perfect? What would be perfect? Is perfect achievable? Is perfect even desirable? I am not saying don't do nothing, but still there are balances to any of these matters. Wouldn't progress be being made by first having all (or most) exchanges showing their bitcoin (showing what is verifiable, first?)? That would be a start, no? That would be a step in the right direction, no?

Powell seems to be suggesting that it is totally worthless to show the reserves because it is not enough and it is misleading - but is it a step in the right direction? Do we believe that a company is going to show everything? Every single thing? Where's the incentive to show every single little thing? And where is the verifiability in terms of showing every single little thing? At least with bitcoin, and the bitcoin's blockchain there is verifiability.. and what else has anything close to the same level of verifiability as bitcoin? Everything else requires some level of trust, no?

So I am not sure how you can show everything else without trust, so why not start with the verifiable aspects first.. and then once we get everyone showing the verifiable aspects (if that's even possible?), then we might be able to take some additional steps from there? Maybe some exchanges are willing to show some of the their liabilities, but getting to show everything seems a bit much to expect anyone to cooperate in doing or even to consider that we want that level of transparency? Then when is it going to stop? When are the disclosures going to stop? First institutions (such as exchanges) disclosing, but do the disclosures stop at that point, or then will we require individuals to disclose too?

The way I see it, perfect is desirable, but, sadly, not achievable. But we can try our best to get as close to it as we possibly can.

The problem I have with Binance's "Proof of Reserves" system, as explained by Kraken's Jesse Powell, is that they are adding up their assets and calling the sum "reserves". They are abusing the term, it is misleading and can give the wrong impression to clients who are not able to understand the terminology used.

Binance Proof of Reserves gives a proof that all user deposits in exchange are backed by some some funds, that's what exchange claims.

"What this means in actual terms is that Binance holds all user assets 1:1 (as well as some reserves), we have zero debt in our capital structure and we have made sure that we have an emergency fund (SAFU fund) for extreme cases,"
https://www.binance.com/en/news/top/7297483

The drawback with this Proof of Reserves is that it gives a summery of balance not complete data that shows movement of data like we have in case of Bitcoin blockchain.