CEO of Binance and Coinbase Agrees With Vitalik Buterin’s Idea for Crypto Exchanges
CEO of Binance and Coinbase Agrees With Vitalik Buterin’s Idea for Crypto Exchanges.
A nod of approval has come from Binance CEO and Coinbase CEO in the world for the idea Vitalik Buterin has of making exchanges more transparent.
ETH Vitalik Buterin’s Idea
Many major crypto ecosystems collapsed in 2022, highlighting the need to restructure crypto exchanges.
Vitalik Buterin, co-founder of Ethereum, believed that crypto exchanges should look beyond “fiat” methods for ensuring their stability, such as Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (zk-SNARK).
“The simplest thing that we can do is put all users’ deposits into a Merkle tree (or, even simpler, a KZG commitment), and use a ZK-SNARK to prove that all balances in the tree are non-negative and add up to some claimed value,” he said.
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“ If we add a layer of hashing for privacy, the Merkle branch (or KZG proof) given to each user would reveal nothing about the balance of any other user,” he added.
By using Merkle Trees, blockchain data can be encoded more efficiently and securely, and information can be verified more rapidly without revealing the entire data set. Known as polynomial commitment schemes, KZGs allow verifiers to verify the validity of claims.
Supporting the idea
The CEO of Coinbase, Brian Armstrong, responded to Buterin’s proposal by thanking the Ethereum co-founder,
“Thank you @VitalikButerin for helping drive this research forward. On-chain accounting will be an important part of the cryptoeconomy,” he said on Twitter.
Thank you @VitalikButerin for helping drive this research forward. On-chain accounting will be an important part of the cryptoeconomy. https://t.co/UzqL0kMaEF
— Brian Armstrong (@brian_armstrong) November 19, 2022
Meanwhile, fellow crypto entrepreneur CZ, who has highlighted Binance’s mission of complete transparency, agreed that Buterin’s recommendations are essential.
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“Vitalik’s new ideas. Working on this. Just don’t read the title aloud around people (Vitalik wrote it).,” he said on Twitter.
Vitalik's new ideas. Working on this.
Just don't read the title aloud around people (Vitalik wrote it).https://t.co/AtR6KiSx5B
— CZ 🔶 Binance (@cz_binance) November 19, 2022
Buterin believes crypto exchanges should become non-custodial, but some aspects should be centralized to provide services such as wallet recovery and regulatory compliance.
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