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Binance Adds ZK-SNARKs to Improve Privacy of Proof of Reserves Report

Binance Adds ZK-SNARKs to Improve Privacy of Proof of Reserves Report
In Brief
  • Binance introduces zk-SNARKs into Proof of Reserves to prove changes to user asset balances with greater anonymity.
  • The exchange is also adding SHIB, DOT, CHZ, and SOL to the assets covered in future reports.
  • Crypto VC Nic Carter suggests the zk-SNARKs add significant privacy value to Proof of Reserves reports, but reports must be backed by other regulations related to an exchange’s fidcuiary duties.

Binance announced that it would introduce zero-knowledge proofs to improve the quality of its Proof of Reserves report.

Zk-SNARKs will allow Binance users to securely and privately confirm nonnegative balances and changes of balances using information from its proof of reserves Merkle tree.

Binance Makes Progress in PoR Roadmap, But Auditors Are Missing

As part of the announcement, Binance said it added SHIB, DOT, CHZ, and SOL to the assets covered by its proof of reserves report. Additionally, the exchange will open-source the zk-SNARKs code to improve transparency and to help other exchanges improve their reporting. Binance has yet to reveal the frequency of forthcoming reports.

Zk-SNARKs, an abbreviation of zero-knowledge succinct on-interactive arguments of knowledge, confirms a statement’s truth without revealing any information about the statement.

The zk-SNARK will verify that each user’s asset balance set is part of a global state of user funds Binance maintains. Additionally, it will anonymously ensure that the user’s net balance is not negative by including collateral posted for margin trading. Customers can use zk-SNARKs to verify that the Merkle root hash in Binance’s Merkle tree reflects asset balance changes. The Merkle root hash is essentially a cryptographic summary of all user balances. Changes to a user’s asset balances will prompt an update of the Merkle root hash, which the zk-SNARK will confirm.

Binance’s addition of zk-SNARKs is the last step in a transparency roadmap outlined at the end of November 2022. Part of its roadmap involved securing the services of a third-party auditor to audit its proof-of-reserves. This initiative has been jeopardized by the exit of accounting firm Mazars from the crypto space. Mazars was the accounting firm that conducted an agreed-upon procedure for the exchange’s first proof-of-reserves report.

Crypto VC Says Zero-Knowledge Proofs Only One Part of the Puzzle

While the technical implementations of PoRs vary, crypto VC Nic Carter expects zero-knowledge methods to supersede the technical limitations of traditional Merkle tree reports.

However, while zk-SNARKs represent an important step in the right direction for the world’s largest exchange, it is still only one part of a broader toolkit that can prevent collapses like FTX. Blockchain expert Anndy Lian agreed, saying that while not perfect, zk-SNARKs provide a “big enhancement.”

According to Carter, exchanges need additional rules to segregate corporate and user assets and protect customer assets from bankruptcy. Additionally, U.S. lawmakers must create a viable market for accounting firms to invest in tools to oversee PoR attestations. Doing so would also encourage offshore exchanges to conduct PoR reports.

Because audits are expensive and done quarterly, Carter suggests that they accompany, rather than replace, more frequent PoR reports, which provide updated customer reassurances.

Source: https://beincrypto.com/binance-adds-zk-snarks-proof-of-reserves-report/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
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Here Are the Most Popular Cryptocurrencies in South Korea: Report

Here Are the Most Popular Cryptocurrencies in South Korea: Report

The five most preferred digital assets by South Korean investors are Bitcoin (BTC), Ripple (XRP), Ether (ETH), Cardano (ADA), and Dogecoin (DOGE).

South Korean investors reportedly own over $5 billion worth of Bitcoin (BTC). Ripple (XRP) is the second most popular digital asset as locals hold nearly $4.8 billion in it.

BTC and XRP Lead the Way

South Korea’s leading crypto exchanges – Upbit, Bithumb, Coinone, and Korbit – conducted a study to determine which digital assets are the most attractive to local investors. The largest cryptocurrency by market capitalization – Bitcoin (BTC) – places first as South Koreans have invested more than $5 billion in it. The native token of Ripple – XRP – ranks second with around $4.8 billion distributed in it.

The third and fourth places belong to Ether (ETH) and Cardano (ADA), respectively. Investors own approximately $4.5 billion worth of the second-largest digital asset and nearly $1 billion in ADA.

Interestingly, the first-ever memecoin – Dogecoin (DOGE) – rounds up the top 5. South Koreans hold almost $900 million worth of it.

The report noted that local investors traded over $7 trillion in digital assets throughout 2021. The figure is more than the entire amount traded on the main Korea Composite Stock Price Index and the transactions on the junior Kosdaq.

South Korea Takes the Crypto Path

Last month, the East Asian country held its most contested presidential election. In the aftermath, the candidate of the Conservative party – Yoon Suk-yeol – collected only 263,000 votes more than his opponent and became South Korea’s next President. What’s more interesting is that he is a keen proponent of the cryptocurrency industry and vowed to turn his homeland into a digital asset hub.

During his campaign, he promised to allow initial coin offerings (ICOs) and increase the minimum threshold for paying capital gains tax on profits from crypto investments. He vowed to change the law and ensure that those who generate revenues of less than $40,000 annually should be exempt from paying taxes. Currently, such taxation is imposed on investors who make more than $2,000 per annum.

Korea Blockchain Association – a lobby group for crypto exchanges – envisioned that the new leader of South Korea will positively impact the local digital asset ecosystem. Secretary-General Yoon Seong-han said:

“We definitely welcome his stance as he is confident about boosting the industry. As ICOs are banned now, we have no choice but to issue coins in Singapore and other countries. Ventures and startups will be able to raise money easily from investors [if the ban is lifted].”

BigONE Exchange’s Chairman – Anndy Lian – also welcomed the new President of the country:

“He understands the importance of crypto. He understands the future, and it is unstoppable.”

 

Original Source: https://cryptopotato.com/here-are-the-most-popular-cryptocurrencies-in-south-korea-report/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j