Re: Proof of reserves? Insurance fund? Best I can do is a random number generator!
⭐ Merited by o_e_l_e_o (4)
If you've not been following the FTX trial, you really should, because the level of fraud on display is enough to even rival that of CSW. Here are two snippets of code (pictures courtesy of https://nitter.cz/molly0xFFF) which have been submitted as evidence in the trial. This code is regarding FTX's insurance fund which was widely publicized:
The first picture above shows how the value of 5,250,000 FTX Token supposedly in the insurance fund was "calculated". It wasn't. It was just coded in. insuranceFund.size = 5250000 FTT.
The second picture above shows how the value of USD in the insurance fund was "calculated". The daily trading volume on FTX was multiplied by a random number, and this was used to adjust the insurance fund to a new size.
This is the kind of bullshit centralized exchanges are using in their "proof of reserves", "safu funds", "insurance funds", "collateral funds", "1-to-1 matching reports", and all the other trash they peddle to convince you your funds are totally safe. Literal random number generators. They will do and say anything to get you to hand over your coins to them. Don't fall it.
The first picture above shows how the value of 5,250,000 FTX Token supposedly in the insurance fund was "calculated". It wasn't. It was just coded in. insuranceFund.size = 5250000 FTT.
The second picture above shows how the value of USD in the insurance fund was "calculated". The daily trading volume on FTX was multiplied by a random number, and this was used to adjust the insurance fund to a new size.
This is the kind of bullshit centralized exchanges are using in their "proof of reserves", "safu funds", "insurance funds", "collateral funds", "1-to-1 matching reports", and all the other trash they peddle to convince you your funds are totally safe. Literal random number generators. They will do and say anything to get you to hand over your coins to them. Don't fall it.
Once again conclusive proof that centralized exchanges cannot and should not be trusted! The weak point always remains the same: "Trust us". A decentralized technology should be completely unreliant on trust. But it does not work if you give someone else custody of your wallet.
I keep telling people:
Do not keep money on centralized exchanges, if possible. If you absolutely have to sate your urge to daytrade or something then at least use decentralized services. (But watch out for DeFI scammers.)