4 ms·

I’m not sure what you mean by this exactly. Many of the things they said to the public are not true, but these currencies use permanent, public ledgers, so you

I’m not sure what you mean by this exactly. Many of the things they said to the public are not true, but these currencies use permanent, public ledgers, so you can see where the money goes if you look carefully.

TedDoesntTalk 4y ago
Does the ledger capture loans of user funds held by FTX?
- mumbisChungo 4y ago
  Yes
  - JustLurking2022 4y ago
    Not if the asset being loaned is cash
nullc 4y ago
How is that particularly relevant? Data isn't knowledge. Just because some assets have public records doesn't really tell you anything about liabilities or underlying ownership. Exchanges could practice provable solvency ( https://eprint.iacr.org/2015/1008.pdf https://eprint.iacr.org/2015/1008.pdf ), but they aggressively do not-- in part because they don't want to bring customers attention to the potential issue (and they rightfully reason that once customers are concerned no amount of technical solution will likely satisfy them). But FTX wasn't really an exchange-- it was a scamcoin casino primarily trading in highly leveraged proxy assets ("perpetuals") as a bucketshop.
- markisus 4y ago
  How can the provable solvency scheme possible prove solvency for fiat holdings? For example, I deposit $100 into the exchange. How can the exchange prove to me that it hasn't gone and gambled that $100? I think this could only be handled with human auditors going in and checking the actual amounts held in the exchange's bank accounts.
  - nullc 4y ago
    Can't, except as you note. Best trade your fiat for something actually auditable through cryptographic means ASAP. :) (for a less quippy answer: they could show their fiat liabilities through these means and have a third party bank attest to their fiat account assets (or an encryption of their fiat assets). At least then you'd be trusting some established bank and not just some sketchy cryptocurrency industry company)

TedDoesntTalk 4y ago

Does the ledger capture loans of user funds held by FTX?

mumbisChungo 4y ago
Yes
- JustLurking2022 4y ago
  Not if the asset being loaned is cash

nullc 4y ago

How is that particularly relevant? Data isn't knowledge. Just because some assets have public records doesn't really tell you anything about liabilities or underlying ownership. Exchanges could practice provable solvency ( https://eprint.iacr.org/2015/1008.pdf https://eprint.iacr.org/2015/1008.pdf ), but they aggressively do not-- in part because they don't want to bring customers attention to the potential issue (and they rightfully reason that once customers are concerned no amount of technical solution will likely satisfy them). But FTX wasn't really an exchange-- it was a scamcoin casino primarily trading in highly leveraged proxy assets ("perpetuals") as a bucketshop.

markisus 4y ago
How can the provable solvency scheme possible prove solvency for fiat holdings? For example, I deposit $100 into the exchange. How can the exchange prove to me that it hasn't gone and gambled that $100? I think this could only be handled with human auditors going in and checking the actual amounts held in the exchange's bank accounts.
- nullc 4y ago
  Can't, except as you note. Best trade your fiat for something actually auditable through cryptographic means ASAP. :) (for a less quippy answer: they could show their fiat liabilities through these means and have a third party bank attest to their fiat account assets (or an encryption of their fiat assets). At least then you'd be trusting some established bank and not just some sketchy cryptocurrency industry company)