The collapse of FTX, one of the largest cryptocurrency exchanges, continues to maintain its heat on the agenda.
While the expert names of the industry about the FTX collapse have been making evaluations one after another, the last statement on this issue has been made. Vitalik Buterin, co-founder of Ethereum (ETH)It came from
Speaking to Bloomberg yesterday ETH The co-founder acknowledged that the collapse of FTX was a major event in the crypto industry, saying that the FTX crisis made the issue of market centralization be re-addressed.
Evaluating the stock market’s development of proof of reserve after the FTX collapse, Buterin suggested various solutions in this regard.
Stating that there are some security vulnerabilities in the Merkle Tree method developed within the scope of proof of reserve of stock exchanges, Buterin emphasized that technologies such as ZK-SNARK should be used to show stock market reserves and responsibilities.
Vitalik Buterin also made several suggestions to prevent exchanges from using funds in different areas, as in FTX.
In this context, Buterin stated that exchanges can use Plasma and Validium methods to stop the use of user funds, and pointed out that these methods can increase costs as a disadvantage.
“What happened at FTX was of course a great tragedy. However, many in the Ethereum community also see the situation as a confirmation of what they believed all along: anything centralized is suspect by default.”
Finally, thinking that centralized exchanges are partially beneficial, Buterin said that after the lessons learned from the FTX collapse, exchanges should now adopt the proof-of-reserve mechanism to have more open and transparent ownership.
Thus, exchanges will have taken a big and important step towards becoming a safer environment for users.
LUNA and TerraUSD algorithmic stablecoin TOP’Commenting on the collapse of Buterin, “Such collapses are essential for the ecosystem on the one hand, but I wish this collapse had happened when Terra/Luna was 10 times smaller” said.
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