{"id":512461,"date":"2022-11-19T13:50:00","date_gmt":"2022-11-19T10:50:00","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/binance-ceo-cz-begins-working-on-vitalik-buterins-safe-cex-ideas\/"},"modified":"2022-11-19T13:50:00","modified_gmt":"2022-11-19T10:50:00","slug":"binance-ceo-cz-begins-working-on-vitalik-buterins-safe-cex-ideas","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/binance-ceo-cz-begins-working-on-vitalik-buterins-safe-cex-ideas\/","title":{"rendered":"# Binance CEO CZ begins working on Vitalik Buterin&#8217;s \u2018safe CEX\u2019 ideas"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a410d41ecc9c\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a410d41ecc9c\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/binance-ceo-cz-begins-working-on-vitalik-buterins-safe-cex-ideas\/#%E2%80%9D_Binance_CEO_CZ_begins_working_on_Vitalik_Buterins_%E2%80%98safe_CEX_ideas_%E2%80%9C\" >&#8221; Binance CEO CZ begins working on Vitalik Buterin&#8217;s \u2018safe CEX\u2019 ideas &#8220;<\/a><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_Binance_CEO_CZ_begins_working_on_Vitalik_Buterins_%E2%80%98safe_CEX_ideas_%E2%80%9C\"><\/span>&#8221; Binance CEO CZ begins working on Vitalik Buterin&#8217;s \u2018safe CEX\u2019 ideas &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-887bb764>The collapse of numerous major crypto ecosystems in 2022 revealed the urgent need for revamping the way crypto exchanges operate. Ethereum (ETH) co-founder Vitalik Buterin believed in exploring beyond \u201cfiat\u201d methods to ensure the stability of crypto exchanges, including technologies such as Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (ZK-SNARKs).\u00a0<\/p>\n<p>Following a discussion with angel investor Balaji Srinivasan\u00a0and crypto exchanges such as Coinbase, Kraken and Binance, Buterin <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/hackmd.io\/@vbuterin\/proof_of_solvency\">recommended<\/a>\u00a0options for the creation of cryptographic proofs of on-chain funds that can cover investor liabilities when required, a.k.a, safe centralized exchanges (CEX). <\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Having a safe CEX: proof of solvency and beyond<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/AKEweYZfj2\">https:\/\/t.co\/AKEweYZfj2<\/a><\/p>\n<p>Big thanks to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/balajis?ref_src=twsrc%5Etfw\">@balajis<\/a> and staff from <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/coinbase?ref_src=twsrc%5Etfw\">@coinbase<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/binance?ref_src=twsrc%5Etfw\">@binance<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/krakenfx?ref_src=twsrc%5Etfw\">@krakenfx<\/a> for discussion!<\/p>\n<p>\u2014 vitalik.eth (@VitalikButerin) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/VitalikButerin\/status\/1593913471967666176?ref_src=twsrc%5Etfw\">November 19, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script>The best case scenario, in this instance, would be a system that does not allow crypto exchanges to withdraw a depositor\u2019s funds without consent.<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\">Vitalik&#8217;s new ideas. Working on this. <\/p>\n<p>Just don&#8217;t read the title aloud around people (Vitalik wrote it).<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/AtR6KiSx5B\">https:\/\/t.co\/AtR6KiSx5B<\/a><\/p>\n<p>\u2014 CZ  Binance (@cz_binance) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/cz_binance\/status\/1593816193772552194?ref_src=twsrc%5Etfw\">November 19, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>Fellow crypto entrepreneur CZ, who has been vocal about Binance\u2019s intent for complete transparency, acknowledged the importance of Buterin\u2019s recommendations, stating that:<\/p>\n<blockquote><p>\u201cVitalik&#8217;s new ideas. Working on this.\u201d<\/p><\/blockquote>\n<p>The earliest attempt to ensure fund safety was proof-of-solvency, wherein crypto exchanges publish a list of users and their corresponding holdings. However, privacy concerns eventually fueled the creation of the Merkle tree technique \u2014 which dampened the privacy leakage concerns. While explaining the inner workings of the Merkle tree implementation, Buterin explained:<\/p>\n<blockquote><p>\u201cThe Merkle tree technique is basically as good as a proof-of-liabilities scheme can be, if only achieving a proof of liabilities is the goal. But its privacy properties are still not ideal.\u201d<\/p><\/blockquote>\n<p>As a result, Buterin placed his bets on cryptography via ZK-SNARKs. For starters, Buterin recommended putting users\u2019 deposits into a Merkle tree and using a ZK-SNARK to prove the actual claimed value. Adding a layer of hashing to the process would further mask information about the balance of other users.<\/p>\n<p>Buterin also discussed implementing proof-of-assets for confirming an exchange\u2019s reserves while weighing the pros and cons of such a system, considering that crypto exchanges hold fiat currencies and the process would require crypto exchanges to rely on trust models better suited for the fiat ecosystem.<\/p>\n<p>While long-term solutions will need the involvement of multisig and <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/social-mediaa\/\" data-internallinksmanager029f6b8e52c=\"1\" title=\"Social Media\" target=\"_blank\" rel=\"noopener\">social<\/a> recovery wallets, Buterin pointed out two alternatives for the short-term \u2014 custodial and non-custodial exchanges, as shown below:<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-11\/29ee338e-0211-4d90-a6eb-54e64b078fc0.png\"><figcaption style=\"text-align: center;\"><em>Two short-term options for\u00a0alternatives for safe CEX. Source:\u00a0hackmd.io (via Vitalik Buterin)<\/em><\/figcaption><\/figure>\n<p>\u201cIn the longer-term future, my hope is that we move closer and closer to all exchanges being non-custodial, at least on the crypto side,\u201d added Buterin. On the other hand, highly centralized recovery options can be used for wallet recovery for small funds. <\/p>\n<p><strong><em>Related: <\/em><\/strong><strong><em>Crypto self-custody a \u2018fundamental human right\u2019 but not risk-free: Community<\/em><\/strong><\/p>\n<p>On Nov. 4, Buterin added a new category of milestones to the Ethereum technical roadmap \u2014 aimed at improving censorship resistance and decentralization of the Ethereum network.<\/p>\n<p><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/VitalikButerin\/status\/1588669782471368704\">https:\/\/twitter.com\/VitalikButerin\/status\/1588669782471368704<\/a><\/p>\n<p>The updated technical roadmap now inserts the Scourge as a new category, which will run parallel to other previously-known segments \u2014 the Merge, the Surge, the Verge, the Purge and the Splurge.<\/p>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/binance-ceo-cz-begins-working-on-vitalik-buterin-s-safe-cex-ideas\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; Binance CEO CZ begins working on Vitalik Buterin&#8217;s \u2018safe CEX\u2019 ideas &#8220; The collapse of numerous major crypto ecosystems in 2022 revealed the urgent need for revamping the way crypto exchanges operate. Ethereum (ETH) co-founder Vitalik Buterin believed in exploring beyond \u201cfiat\u201d methods to ensure the stability of crypto exchanges, including technologies such as&#8230;<\/p>\n","protected":false},"author":1,"featured_media":512462,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMTEvZDM3MWM2MGItNjJmMy00MDc5LWJjZmYtZGVmOGNkZTViOTBiLmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[74860,74891,75582,117,73711],"class_list":["post-512461","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-cryptocurrency-exchange","tag-ethereum","tag-fiat-money","tag-business","tag-investments"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/512461","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=512461"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/512461\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/512462"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=512461"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=512461"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=512461"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}