GM crypto fam.
So, after the FTX debacle, big exchanges rushed to prove their reserves, and that ended up with Mazars halting all work with crypto firms.
Mazars has paused its activity relating to the provision of Proof of Reserves Reports* for entities in the cryptocurrency sector due to concerns regarding the way these reports are understood by the public,
What I dont uderstands is, how can we know which tests will demonstrate the solvency of a centralized crypto exchange? Who is to say that funds cannot be shifted at any time, like SBF did from FTX to Alameda?
Source:
https://app.getresponse.com/view.html?x=a62b&m=BVHuSm&mc=9M&s=BtgXWnG&u=QcLhh&z=ECiRVqJ&No one because there is no central authority to check for the funds of any exchanges, as you have said, they can just shift funds to their behest just like what Alameda and SBF did that cause the biggest fall in crypto so far.
So it's going to be a gamble for everyone to 'trust' which exchange we want to use for our trading activity.
And that is why it's not safe to put your funds on centralized exchanges because it can collapse anytime.