Since the start of the crypto revolution, stakeholders and investors have been trying to establish trust in the industry. But in the wake of several damaging events in 2022, this trust was severely weakened by centralized exchange failures and stiff regulatory policies. Now, crypto exchange giant Binance is spearheading the charge to rebuild trust in the space by implementing bold steps that prioritize transparency, safety, and security. To this end, Binance recently published a policy paper titled “Building Trust in the Crypto Ecosystem” that breaks down practical measures for the entire industry.
In working towards the goal of fostering trust, Binance has dedicated a page on its website dedicated to everything related to trust and transparency.
To ensure the safety of users’ funds, Binance adheres to several robust security measures and encryption protocols such as multi-signature and threshold signature schemes (TSS). The exchange also created an emergency insurance fund — Secure Asset Fund for Users (SAFU) — that stores more than $1 billion in pooled funds in case of any security breach.
Another step Binance took to rebuild user’s faith in the platform was introducing a proof of reserves (PoR) system that discusses the transparency of customer funds. To design this system, the exchange utilised two of the most secure and transparent cryptographic tools: Merkle Tree and Zero-Knowledge Succinct Non-Interactive Argument of Knowledge (zk-SNARKs). This was further improved when Binance updated its PoR disclosure with zk-SNARKs and with further upgrades, it has now been updated to allow verification of user assets for a total of 24 tokens.
Additionally, the exchange has strict token listing requirements to ensure that only high-quality, thoroughly-vetted projects are listed on their platform. This adds a layer of trust and security to the platform and helps protect users from investing in projects with low credibility and high risk.
Binance is also in constant communication with other industry players, associations, and the community to continue raising the bar in terms of trust and transparency. They are actively soliciting feedback and critique in order to make sure that the ecosystem remains secure and trust is established in the industry.
All in all, Binance is leading the way to rebuilding trust in the crypto industry by taking bold steps to advance transparency, safety, and security for industry stakeholders. Their proof of reserve system, emergency insurance fund, and token listing requirements are just a few of the measures they are taking in order to restore faith and trust in the industry.
These efforts, if successful, could accelerate the industry’s much-anticipated mainstream adoption and finally achieve the goal of people investing, trading, and using cryptocurrencies without any hesitation.